A Palestinian rammed a truck into a group of Israeli soldiers visiting a popular tourist spot in Jerusalem on Sunday, killing four and wounding 17 others, authorities said.
The driver was also killed at the location overlooking holy sites such as the Dome of the Rock and providing one of the most spectacular views of Jerusalem.
There was no immediate claim of responsibility for the attack.
Israeli Prime Minister Benjamin Netanyahu who visited the scene said in a statement: "We know the identity of the assailant, who according to all indications supported IS (Islamic State group)."
Palestinian security officials said the driver was a Palestinian in his late 20s from east Jerusalem's Jabal Mukaber neighbourhood. Palestinian media named him as Fadi Al-Qanbar.
Five members of his family were arrested for questioning, Israeli police said.
Chaos broke out at the scene when the truck ploughed through the crowd, as hundreds of soldiers took part in a tour about the history of Jerusalem.
"A lone terrorist drove his truck into a group of soldiers standing on the side of the road," said police spokesman Micky Rosenfeld.
"They got off the bus, and as they were getting off the bus and getting organised, he took advantage."
Reacting to claims that soldiers were slow to react, the army released a video of a soldier saying he shot after realising it was not an accident.
"An investigation is underway but this attack lasted several seconds and once the soldiers understood that it was an attack, they fired in the direction of the vehicle," said army spokesman Moti Almoz.
Multiple bullet holes could be seen in the windshield of the truck.
The military identified the victims as three female soldiers -- Yael Yekoutiel, Shir Hadjaj, Shira Tzour -- and one male, Erez Auerbach. They were all in their 20s.
A video shared online showed a flatbed truck with a crane in the rear drive through a group of soldiers standing next to a bus.
- 'Orders and screaming' -
The driver then pulls off to the side and tries to reverse back towards where the soldiers were hit before the truck eventually comes to a stop.
Visitors, including soldiers, are seen running for cover.
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"I heard my soldiers screaming and shouting," said one of the tour guides, Lea Schreiber.
"I saw a truck that went on the side of the road. Soldiers starting shooting... There were orders and screaming everywhere. They told them to hide behind the wall because there was fear of another attack."
Fawzi Barhum, a spokesman for Islamist movement Hamas, called the attack "heroic and brave".
Rosenfeld said it was not yet clear if the attack had been planned earlier or was spontaneous.
It occurred on the fringes of the Armon Hanatziv Jewish settlement and east Jerusalem's Jabal Mukaber, near UN headquarters at a spot leading to a promenade with picturesque views.
- 'Reprehensible' -
France and the European Union condemned the attack, as did the UN envoy for the Middle East peace process, Nickolay Mladenov.
"It is reprehensible that some choose to glorify such acts which undermine the possibility of a peaceful future for both Palestinians and Israelis," he said.
"There is nothing heroic in such actions."
The White House also condemned the attack, saying "such cowardly acts can never be justified," National Security Council spokesman Ned Price said in a statement.
A wave of Palestinian knife, gun and car-ramming attacks broke out in October 2015, but the violence had greatly subsided in recent months.
Since October 2015, 247 Palestinians, 40 Israelis, two Americans, a Jordanian, an Eritrean and a Sudanese have been killed, according to an AFP count.
Most of the Palestinians killed were carrying out attacks, according to Israeli authorities. Others were shot dead during protests or clashes, while some died in Israeli air strikes on the Gaza Strip.
Many analysts say Palestinian frustration with the Israeli occupation and settlement-building in the West Bank, comatose peace efforts and their own fractured leadership have helped feed the unrest.
Israel says incitement by Palestinian leaders and media is a leading cause.
The status of Jerusalem is one of the most difficult issues in the conflict.
The Palestinians see east Jerusalem, which Israel occupied in 1967 and later annexed, as the capital of their future state while Israel views the whole city as its capital.