In a widely anticipated vote, Washington exercised their veto power on Monday to block UN Security council resolution backed by 14 other Council members that would have forced Trump to retract his recent contested declaration over the status of the much-coveted holy city.
The recent decisions mentioned include President Trump's move to reverse decades of USA policy on December 6 when he Jerusalem as the capital of Israel, and announced plans to move the American embassy there from Tel Aviv.
With the Palestinians rejecting US mediation, Russian Federation said it was ready to take over. The Palestinians want East Jerusalem, now occupied by Israel, as the capital of their future independent state.
It said the US decision to veto the resolution showed once again that Washington had "lost objectivity" and that it was unacceptable for the Security Council to be left "ineffective" with such a move.
He added that the Arab group in the United Nations will convene later to assess the situation and determine the next step in order to defend the status of Jerusalem.
Later on Monday, Turkish President Tayyip Erdogan and British Prime Minister Theresa May discussed the blocking of the resolution in a phone call, and agreed that new tensions that could endanger the peace process in the region should be avoided, sources in Erdogan's office said.
"What we witnessed here in the Security Council is an insult. It won't be forgotten", she said, describing the measure as "one more example of the United Nations doing more harm than good in addressing the Israeli-Palestinian conflict".
Explaining the negative vote (veto), US Permanent Representative Nikki Haley said it had been done to protect United States' sovereignty and its right to choose where to have its embassy.
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It came ahead of a planned trip by the USA vice-president, Mike Pence, to Jerusalem on Wednesday that was set to take place amid a deep rupture in U.S.
"We are ready to become an honest mediator here", he said.
"The United States will not be told by any country where we can put our embassy", she said. Apart from that, the draft calls on countries not to recognize any actions or measures that run counter to the Security Council resolutions and to refrain from establishing diplomatic missions in that city.
The vetoed resolution would also have reiterated a call to reverse "the negative trends on the ground that are imperiling the two-state solution" that would see the states of Israel and the Palestine living side-by-side in peace.
The only support for the United States came from Israel.
He will discuss in Paris the establishment of an global mechanism to replace the United States as a mediator for the peace process, based on the French initiative past year, which culminated in a peace conference attended by 25 foreign ministers from Arab and European countries and the United States, but issued a statement without clear mechanisms or a time limit.
"Thank you, Ambassador Haley", he posted on his official Twitter account.
In Netanyahu's words, "One defeated the many, truth defeated lies".