The interfaith protesters say they are disappointed the US embassy did not accept their letter, instead instructing them to post it.

About 100 protesters marched from Yarralumla Mosque to the US Embassy gates, chanting pro Palestine slogans and holding signs decrying President Trump.

Representatives from Muslim, Christian and Jewish backgrounds spoke in condemnation of the decision.

Rally organiser Emad Soliman said the decision put an end to decades of agreement about Jerusalem's status.

He said President Trump's declaration was a direct breach of international conventions and all previous United Nations resolutions.

Mr Soliman said they appreciated the Australian government reaffirmed its stance to not acknowledge Jerusalem as Israel's capital.

"We believe that Jerusalem is extremely important for all Muslims, Christians and Jewish alike," he said

"However, we strongly urge the Australian government to take a more proactive and unbiased diplomatic role to find a peaceful resolution to the ongoing Israeli – Palestinian conflict would have a direct impact on the global peace and stability."

Said Hajj Hasan Alzein a member of Canberra's Muslim community said President's Trump statement did not change the identity of Jerusalem, "neither does it erase the history and culture of Palestinian Jerusalemites, both Muslim and Christians alike".