Only married men over 45 and married women over 35 were allowed to enter the compound, the third holiest site in Islam.
The number of special permits granted to Palestinian worshippers from the Gaza Strip and the rest of the West Bank was also limited to 5,000.
Israeli police said it was because they feared resistance attacks but Palestinians view the closure as a direct attack on the Friday Prayer, which together with the other daily obligatory prayers, forms one of Islam's five pillars.
"Since the outbreak of the Al-Aqsa Intifada the Israelis have tightened the closure. Right now it's very difficult for Palestinians to enter Jerusalem," said Khalid Amayreh, Aljazeera's correspondent in the West Bank.
""It has been like this for the last 13 years. Prior to the Intifada Palestinians were by and large able to break closures but right now it has become extremely difficult."
Those caught trying to cross illegally face being arrested and held for up to six months under Israel's notorious "administrative detention" provisions.
The status of the holy Islamic compound, coveted by many Jews, lies at the heart of the Middle East conflict.
The inflammatory visit of Israeli prime minister Ariel Sharon to the site in September 2000, seen by Palestinians as an attempt to underline Jewish claims to the sanctuary, triggered the current Intifada or uprising.