At least 41 people were killed and more than 1,000 wounded when violence erupts near the Israel border with Gaza on Monday.
The death toll has continued to climb as Palestinians attempt to cross the border from Gaza to Israel, according to Israeli daily, Haaretz.
About 2,000 Palestinians were also injured, AlJazeera reports.
Protests on the border have escalated in recent weeks but suddenly descended into deadly chaos shortly before the formal launching of the United States Embassy in Jerusalem. President Donald Trump recently recognised Jerusalem as the capital of Israel.
An official opening ceremony for the movement of the embassy to Jerusalem from Tel Aviv is currently underway, with Israeli Prime Minister Benjamin Netanyahu and several top officials from the U.S. on the ground. Jared Kushner, an in-law of Mr Trump, and his wife, Ivanka, who is Mr Trump’s daughter, are currently attending the event which is televised across the world.
Israeli troops intervened to prevent the Palestinian protesters from entering into Israel used tear gas and live ammunition, media reports said.
The soldiers keep Palestinians from scaling a fence across the border. Video feed circulating online shows protestors seeking to cross the border.
Some media reports said many children were among those killed and wounded. Israeli authorities said some in the crowds were throwing explosives or flying flaming kites into Israel.
Mr Trump addressed the audience via a recorded video and praised the decision to move the capital to Jerusalem.
Ivanka Trump unveiled the formal dedication and said she was delighted to pronounce “Jerusalem as the capital of Israel.”
The move is a fulfillment of a major campaign promise of Mr Trump, but it had been condemned by leaders across the world. Critics also feared that the development could further complicate ongoing peace talks in the Middle East.