JERUSALEM (AP) - Israel is determined to keep Yasser Arafat out of Jerusalem even in death, with one Cabinet minister saying yesterday that the holy city is reserved for the burial of Jewish kings, "not Arab terrorists".

Palestinian officials said, however, that it was inappropriate to talk about funeral arrangements as long as their 75-year-old leader clings to life at a Paris hospital.

However, one official said Palestinian leaders are hoping to enlist international support for a burial at the Al Aqsa Mosque compound in Jerusalem, Islam's third-holiest shrine, which was built on the ruins the biblical Jewish temples.

The top Muslim cleric in Jerusalem weighed in for the first time yesterdayy, saying Arafat requested burial near Al Aqsa when the two met four months ago. The remarks by the mufti of Jerusalem, Ikrema Sabri, marked the first official comment on Arafat's burial wishes.

The way the mounting dispute is resolved could signal how Israel and the emerging Palestinian leadership - Prime Minister Ahmed Qureia and his predecessor, Mahmoud Abbas - will get along in the future.

Palestinian officials said a generous Israeli gesture, such as allowing burial in Jerusalem, could go a long way towards building trust destroyed in four years of fighting. However, Israel fears acceding to such a request would strengthen Palestinian claims to the traditionally Arab sector of the city as a future capital.

Arafat is reviled by many Israelis, and seeing him interred near Judaism's holiest site would draw public outrage. Israeli Justice Minister Yosef Lapid said yesterday that Arafat "will not be buried in Jerusalem because Jerusalem is the city where Jewish kings are buried and not Arab terrorists."

Lapid's blunt remarks came despite Prime Minister Ariel Sharon's order to government officials to keep a low profile and avoid antagonizing the Palestinians.

However, Sharon himself told his Cabinet last week that he would not permit Arafat, his old nemesis, to be buried in Jerusalem.

It is not clear if Arafat has left a written will, and Sabri, the mufti, said he was not aware of one. He said the Palestinian leader told him in their meeting four months ago that "he has a desire to be buried in Jerusalem, near the Al Aqsa Mosque".

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