Police have not determined whether the reported incidents are related or what motive may have been behind them. But Prime Minister Benjamin Netanyahu urged authorities to swiftly investigate the "reprehensible murder" and called on all sides "not to take the law into their own hands."
Tensions have mounted between Israel and the Palestinians after the bodies of three Israeli teens were found in the West Bank more than two weeks after they went missing.
Israel has accused Hamas of abducting and killing the three teens, and has arrested hundreds of its members across the West Bank. Rocket fire from the Hamas-controlled Gaza Strip has meanwhile intensified, and been met with Israeli air strikes.
Israeli police spokesman Micky Rosenfeld said police received a report early Wednesday that an Arab teen was "forcibly pulled into a vehicle" in an area of east Jerusalem and that an hour later a body was discovered in a separate part of the city.
He said security was heightened in Jerusalem, with extra units dispatched and the city's light rail train service cut short to avoid the scene of the violence. Police also closed a key holy site in Jerusalem's Old City to visitors after rock throwing there.
Israeli officials urged calm as police investigated the incidents, hoping to contain the violence.
"Everything is being examined. There are many possibilities. There is a criminal possibility as well as a political one," Israel's public security minister, Yitzhak Aharonovitch, told Israel Radio. "I am telling everyone, let us wait patiently."
Nabil Abu Rdeneh, a spokesman for Palestinian President Mahmoud Abbas, said Israel was being held responsible for the death and called on it to "find the killers and hold them accountable," according to the Palestinian official news agency Wafa.
The Arab teen, who was identified as 17-year-old Mohammed Abu Khdeir, was approached by a car early Wednesday and then forced into it before it sped off, his cousin Saed Abu Khdeir said.
On Tuesday thousands attended the funerals of Eyal Yifrah, 19, Gilad Shaar, 16, and Naftali Fraenkel, 16, the three Jewish seminary students who went missing last month and whose bodies were found Monday in a field near the West Bank city of Hebron.
Also Tuesday, several hundred right-wing Israeli youths marched through Jerusalem, demanding revenge for the deaths.
Associated Press writer Mohammed Daraghmeh in Ramallah, West Bank contributed to this report.
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