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The Palestinian attacker was killed in an attack in Jerusalem's old town on Monday evening.
The man shot at a police station, said the Israeli police.
The police started the chase and the man continued to shoot them.
A police spokesman confirmed that he was shot by border guards.
A police officer was slightly injured in a fall.
The police initially gave no information about the man's identity.
In Israel and in the occupied West Bank, there are repeated armed attacks by Palestinians on Israeli soldiers and Jewish settlers.
The perpetrators are often armed with knives or attack their victims with their cars.
The site of the Al-Aqsa Mosque, known by Jews as the Temple Mount, is in the east of Jerusalem.
Israel occupied the eastern part of the city in the Six Day War in 1967 and annexed it in 1980.
The UN does not recognize the annexation.
The Palestinians are demanding the territories for their own state - with East Jerusalem as the capital.