The significance of Jerusalem is that it is the city of many Prophets of Allah as Makkah is the city of Prophets Ibrahim (Abraham), Isma`il (Ishmael) and Muhammad (peace and blessings be upon all of them).
The status of Al-Aqsa is clearly explained in the hadith that reads: “People are not to travel except to three mosques: The Sacred Mosque (in Makkah), Al-Aqsa Mosque (in Jerusalem ), and my Mosque (in Madinah).” (Muslim)
The Mosque of Al-Aqsa is one of the ancient mosques and in the Qur’an Allah called it and its land “the blessed surroundings” (Surat Al-Israa’: 1).
When Prophet Muhammad (peace and blessings be upon him) was in Makkah and also for about 17 months after his Hijrah to Madinah, he and his followers used to pray towards the direction of Al-Aqsa Mosque.
This was to establish in the minds of Muslims the link between the teachings of Prophet Muhammad and other Prophets of Allah (peace and blessings be upon them all).
When this principle was established in their minds then Allah ordered Muslims to turn to the Ka`bah and pray towards its direction.
Now, we are not allowed to pray to the direction of Jerusalem and Al-Aqsa Mosque, but we must respect and honor the city of Jerusalem and its blessed mosque. It is also the duty of all Muslims to guard and protect this mosque from any harm and damage, for the mosque belongs to those who believe in all the prophets and messengers of Allah.
Almighty Allah knows best.
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