A Palestinian rammed his car into a group of Israeli soldiers in Occupied Jerusalem on Monday, hours after Foreign Minister Tzipi Livni agreed to try to form a new government that can avert an election and forge a peace deal.
The man, who neighbors said lived in Jerusalem, was shot dead after injuring 15 of the soldiers and four others, under the walls of the Old City on a road that marks the dividing "Green Line" between Arab East Jerusalem and the Jewish west.
Police described it as a "terrorist" attack, the third of its kind using vehicles against Israelis in the city since July.
The incident took place near Tzahal Square, just outside the 400-year-old walls of Jerusalem's Old City and a few hundred meters (yards) from Jaffa Gate, a major tourist thoroughfare.
Jerusalem police chief Aharon Franco told journalists the perpetrator was a Palestinian from east Jerusalem, but declined to give further details about him.
"The police are investigating to see whether the perpetrator of the attack had any accomplices, but the initial evidence we have indicates it was the isolated act of an individual," he told reporters.
There was no immediate claim of responsibility from any armed group.
Police have meanwhile stepped up security across the city ahead of the Jewish high holidays in October, when large numbers of people are expected to visit Jerusalem and its holy sites.
Monday's incident came just hours after Israeli President Shimon Peres asked Foreign Minister Tzipi Livni to form a new government after the resignation of Prime Minister Ehud Olmert, who has been dogged by corruption allegations.
Livni, 50, a former Mossad spy who replaced Olmert as head of the centrist Kadima party in a leadership vote on Wednesday, could become Israel's second woman prime minister after Golda Meir, who served from 1969 to 1974.
Defense Minister Ehud Barak, the head of the Labour Party and a crucial coalition ally, said the home of the Palestinian had to be "destroyed as soon as possible" to dissuade others from carrying out similar acts.
The United Nations and international human rights groups have said that such demolitions contravene international law under the Geneva Convention and have called on Israel to suspend such collective punishment.
Exactly two months earlier, on July 22, a Palestinian wounded 16 people when he turned an earth mover on passers-by and vehicles in Jerusalem.
That incident mimicked one 10 days earlier in which another Palestinian, also in an earth mover, killed three Israelis and injured more than 45. Both men were shot dead immediately after the attacks.
On March 6, a Palestinian opened fire at a Jewish religious school, killing eight Israeli students in the worst attack the city had seen in years.
In each instance, the attackers hailed from east Jerusalem, prompting calls from across the political spectrum for their homes to be destroyed.
More than 250,000 Palestinians live in east Jerusalem. They hold special ID cards that allow them to travel and work in Israel, but are not citizens.
Israel occupied and annexed east Jerusalem, including the Old City, in the 1967 Six Day War and considers the entire city to be its "eternal, undivided" capital, a claim not recognized by the international community.
The Palestinians have demanded east Jerusalem as the capital of their future state.