REUTERS

The troubles erupt after the evening meal that breaks the Ramadan fast, when Jewish settlers, guarded by Israeli police, and Palestinians trade abuse on the streets of East Jerusalem.

A long-running legal case, in which several Palestinian families face eviction from homes on land claimed by settlers, is at the heart of the confrontations during the Muslim holy month, with a key court session due to be held on Thursday.

"Go back to Jordan," settlers shout in the Sheikh Jarrah neighbourhood, a part of Jerusalem that Israel captured from its eastern neighbour in the 1967 Middle East war.

"Racists" and "mafiosi", Palestinians yell back.

Over the past week, police in riot gear and on horseback have moved through Sheikh Jarrah, arresting Palestinian youths and using water cannon to spray foul-smelling liquid to disperse the crowds.

Sheikh Jarrah sits just outside Jerusalem's walled Old City, near the famous Damascus Gate. The area includes many Palestinian homes and apartment buildings as well as hotels, restaurants and consulates.

Damascus Gate saw nightly clashes between Palestinians and Israeli police in April over a dispute over access to the gate's ampitheatre-style square. 

Palestinian medics said 12 Palestinians have been injured since Sunday in the latest clashes, with three requiring hospital treatment. Police said Palestinian protesters have thrown rocks and firebombs at them during the demonstrations.

Sheikh Jarrah's residents are overwhelmingly Palestinian, but the neighbourhood also contains a site revered by religious Jews as the tomb of an ancient high priest, Simon the Just.

Thursday's hearing at Israel's Supreme Court may decide if the evictions ordered by a lower court are upheld, or if the handful of Palestinian families can appeal.

Human rights campaigners say that if the Palestinians lose the court battle, it could set a precedent for dozens of other homes in the area.

"They would have to kill us... that's the only way we would leave," Abdelfatteh Iskafi told Reuters.

Nuha Attieh, 58, said she fears her family will be next if the ruling is upheld.

"I'm scared for my home, for my kids, I'm scared about everything."

A group of eight Israeli settler families living across the road from the houses they claim say the area was Jewish in the past, and the Israeli court had "decided that we can get back our houses".

"This is a Jewish country. They want to control it," one of the settlers told Reuters on Tuesday, pointing at the Palestinians on the other side of the street.

Giving only the name Eden, he added: "We have done nothing illegal. Arabs came from Jordan 50 years ago and should go back."

The Palestinians say they have lived in Sheikh Jarrah since the 1950s, when they were re-housed there by Jordan after fleeing or being forced to abandon their homes in West Jerusalem and Haifa during fighting that surrounded Israel's creation in 1948.

The settlers who filed the lawsuit said they legally bought the land from two Jewish associations that purchased it at the end of the 19th century, the Israeli anti-settlement group Peace Now said. 

A lawyer representing the settlers declined to speak with Reuters.

The status of Jerusalem is at the heart of the Israeli-Palestinian conflict. Palestinians want East Jerusalem as the capital of a future state and most countries regard settlements that Israel has built there as illegal.

Israel claims all of Jerusalem as its capital, citing biblical and historical links to the city.