Jerusalem's top Muslim cleric Mohammed Hussein has been released by Israeli police after six hours of questioning over "recent disturbances" at a disputed holy site on a hilltop compound in Jerusalem's Old City.

The Grand Mufti of the city was released without charge but the move attracted criticism from Palestinian and Jordanian leaders alike.

Recent clashes between Israeli and Palestinian activists resulted in the arrest of 10 Palestinians.

An unnamed Israeli official told AP that police warned Hussein to lower tensions after the disorder. According to reports, Muslim worshippers threw rocks and chairs at tourists visiting the sacred compound, which houses the Al Aqsa Mosque, the third holiest site in Islam, from which Muslims believe Prophet Muhammad ascended to heaven.

Meanwhile, the religious services ministry is reportedly working to allow Jews to pray on the compound.

"It cannot be that in the state of Israel Jews need to stand aside. The Temple Mount should be a place where people of any religion can pray," Miri Regev, chairwoman for the Knesset interior committee, said.

A member of the Knesset for the United Arab list rebutted the proposal, saying that Jerusalem "will return to Palestinians and Muslims".

The compound is known by the Jews as Temple Mount, built above the ruins of the two biblical Jewish temples, and by the Muslims as Haram as-Sharif or Noble Sanctuary.

Palestinians see visits by Israelis at the site as a provocation. The mufti of Jerusalem is the top cleric in charge of Jerusalem's holy places, including the compound.