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Disputes between religious communities over access to holy places are a staple of life in Jerusalem's Old City, but it was more than just another sectarian turf battle that saw Israeli police on Oct. 25 enter the Muslim-controlled area on the Temple Mount to quell stone-throwing by Palestinians. Instead, the riot in the Holy City was yet another sign that, in the absence of any real peace process, the two sides may be headed for renewed confrontation.

For weeks now, tensions have been mounting in Jerusalem. Spurred by the Obama Administration's efforts to revive final-status negotiations and emboldened by its successful rebuff of Washington's demand for a settlement freeze, Israel has moved to consolidate its control of occupied East Jerusalem by demolishing Palestinian homes and expanding Israeli construction there. Islamist groups have seized on archeological excavations in the Old City to claim that Israel plans to seize control of the Muslim holy sites — a charge vehemently denied by Israel, but one that has nonetheless roused outrage across the Muslim world. In response to feared protests, Israel has barred Palestinians under 50 or not resident in Jerusalem from access to the al-Aqsa Mosque complex on the Temple Mount — known to Muslims as the Noble Sanctuary — and that, in turn, has only heightened Muslim suspicions over Israel's intentions.

The clashes on Oct. 25 came after Islamist groups called for Palestinians to "defend" the site after Israel had allowed Israelis to enter it the previous day. The confrontation may have had less to do with keeping Jews from praying at al-Aqsa, however, than with the erosion in Palestinian faith in President Mahmoud Abbas' path of negotiating peace with the Israelis and Americans. Hamas leader Khaled Mashaal set the tone that day by declaring, "Jerusalem's fate will be decided with jihad and resistance, and not negotiations." The symbolic power of the Jerusalem issue has a radicalizing effect not only on the Palestinians, but all across the Arab and Muslim world, with anti-Israel sentiment at a fever pitch even in Turkey, a long-standing Israel ally.

Although Hamas supporters may have played a leading role in the Jerusalem protests, there was plenty of evidence of Fatah supporters fighting alongside them — a fact noticed by the Israeli government, which banished the Palestinian Authority official responsible for the holy sites for two weeks. Nor is that a new development: while Abbas continues go through the motions demanded by the Obama Administration, he has reportedly threatened to quit and warned that no peace is possible with the hawkish government of Prime Minister Benjamin Netanyahu. And many leaders of Abbas' own Fatah movement are now privately talking about going back to the barricades. A split has emerged between Abbas and a younger generation of Fatah commanders who have lost patience with his faith in a U.S.-led peace process that has left them no closer to statehood than they were a decade ago. There are daily confrontations between the old guard and the new guard, says Hassan Bakir, chairman of the Palestinian Center for Research and Documentation in Beirut. They are tired of listening to Abbas, who hasn't lived up to his promises. The new guard is calling for a return to resistance.

Rather than restore Palestinian faith in the peace process, the Obama Administration's efforts may have only fueled the backlash. Any optimism over renewed peace efforts that had been generated by President Obama's Cairo speech quickly dissipated as Washington failed to win Israeli compliance with its demand for a settlement freeze. And the Administration put Abbas in an untenable position earlier this month by leaning on him to revoke Palestinian support for the U.N. discussing the Goldstone Report, which accused Israel and Hamas of committing war crimes during last winter's fighting in Gaza. So intense was the outcry that followed among Palestinians, including top leaders of Fatah, that Abbas was forced to make a humiliating about-face.

If Israel's relations with the Palestinians are deteriorating and propelling a less accommodating Palestinian leadership to the fore, the scuffles in Jerusalem are also deepening Israel's isolation in the Muslim world. France this week had to cancel plans for a summit of Mediterranean countries after Egypt refused to attend a meeting with Israel's hard-line Foreign Minister Avigdor Lieberman. And in Jordan on Oct. 26, the 15th anniversary of a peace deal with Israel was observed by demonstrators burning an Israeli flag and calls by the parliamentary opposition for the pact to be rescinded.

Obama raised expectations after taking office by promising the region speedy movement toward settling the Middle East's most toxic conflict. So far, the Administration's efforts have produced precious little progress — and unfortunately for Obama, the Palestinians may no longer be waiting for Washington to do more to press the Israelis. Instead, they are growing more inclined to do that themselves, in ways that could quickly turn the Middle East into a crisis for the Administration.

— With reporting by Rami Aysha / Beirut and Jamil Hamad / Bethlehem

• Andrew Lee Butters
• As the Obama Administration's peace efforts founder, Israelis and Palestinians are once again staking their claims on the Holy City -- and threatening a regional crisis