The old city of Jerusalem contains sites holy to Jews, Muslims and Christians. At the heart of the bitter Palestinian-Israeli dispute is the Temple Mount or Haram al-Sharif.
What is the historical and religious significance of these sites, and what are the options on Jerusalem being considered by negotiators?
Religious Heritage:
Just below the Mount is the Western or Wailing Wall. This is part of the retaining wall of the Temple Mount dating back to a time when a Jewish temple stood on the Mount.
For religious Jews, the Mount is where redemption will take place when the Messiah arrives. Giving up the Temple Mount would be, for religious Jews, like giving up on redemption.
The Koran says that the Prophet Muhammad ascended to heaven from this spot.
Popular Islamic tradition speaks of the Prophet being taken from Makkah to Jerusalem on a winged horse and then being lifted to heaven where he was shown by God when and how to pray, one of five pillars of Islam.
Greek, Russian, Armenia, Ethiopian, Syrian and Romanian Orthodox churches, and Catholic and Protestant churches are represented in the city.
National symbols:
For secular Jews, the Temple Mount is a profound national symbol. The capture of the Western or Wailing Wall in 1967 was, even for the non-devout, a great national achievement.
Equally, the Haram al-Sharif is of deep religious and political significance to Palestinians and to Muslims around the world.
For Palestinians, having their future capital in East Jerusalem is a fundamental element of any future state.
The options for Jerusalem:
Many Palestinians - and Muslims in the wider world - would not endorse a peace agreement that left Israel in full control of Jerusalem and its holy sites.
Palestinians also want sovereignty or some other form of jurisdiction over East Jerusalem, the Arab part of the city, which under international law has been illegally occupied by Israel since 1967.
This solution would not solve the issue of holy sites, because al-Quds under this plan would not include the Temple Mount.
"No Jewish prime minister will sign (an) agreement that transfers the sovereignty of the Temple Mount to the Palestinians or to an Islamic body," Mr Barak said.
The Vatican, and in particular Pope John Paul II, has often called for Jerusalem to be given special status.
Reports in that the Israeli Government was considering international sovereignty over the Temple Mount site have been denied by officials.
The concept of 'God's' or 'divine' sovereignty has been raised. Under this model, neither Palestinians nor Israelis have sovereignty over the holy sites, which are seen as too important to fall under any one state's political sovereignty.
The sites would therefore be administered by Jewish, Muslim and Christian leaders.
Under the 1948 United Nations resolution on the partition of Palestine, Jerusalem was designated as a special international city to be administered by the UN.