Speaking from the White House, President Donald Trump made this announcement on Wednesday.
In line with this announcement, the U.S. is also shifting its embassy from Tel Aviv to the holy city, again becoming the first country to take such a step.
With this step, Trump has fulfilled one of its campaign promises and reversed decades-long U.S. policy on this matter.
Jerusalem is considered a sacred place, which is home to Jewish, Christian and Muslim holy sites. However, it is also a disputed territory, contested by both Israel and Palestine, which sees it as a capital of its future state.
Arab League and Organization of Islamic Cooperation have already decried the move, saying such a step would further fuel instability in the Middle East, which is already battling numerous wars and civil strife. They also contested that recognizing Jerusalem as the capital would leave no scope for peace negotiations between Palestine and Israel.(ANI)