Eighty-eight homes in an Arab neighborhood of Jerusalem (search) are marked for demolition to make way for an archaeological park documenting the disputed city's ancient Jewish origins, the engineer overseeing the project said Wednesday.

Palestinian officials warned of grave damage to peace efforts and demanded that Israel scrap the plan to raze the houses in the Silwan neighborhood, just below the walled Old City and near Islam's Al Aqsa Mosque (search) compound and Judaism's Western Wall (search).

Several homeowners have been served eviction notices, but the plan still faces court challenges. If approved, it would be one of the largest demolitions since Israel captured traditionally Arab east Jerusalem in 1967, Israeli human rights activist Danny Seidemann said.

About one-third of Jerusalem's 700,000 residents are Palestinians, but the city administration is predominantly Jewish. Most Palestinians refuse to take part in official municipal activities, regarding them as recognition of Israeli control over the city.

City engineer Uri Shetrit told The Associated Press that nearly all homes in the part of Silwan marked for demolition were built in violation of zoning regulations, and courts have already issued orders to tear down one-third of the 88 homes. Shetrit said the intent is to restore a biblical-era feel to the area, which once was covered with date and chestnut trees.

Palestinian officials warned that violence could flare over the demolitions. In the past, disputes over Jerusalem have triggered large-scale Israeli-Palestinian fighting, including the current round that began in 2000.

Shetrit said the area of Silwan targeted for demolition was declared a "green zone" by Israel in 1974. He said that all but seven of the 88 homes were built in the past 12 years and that the municipality has aerial photos to back up its claim.

Palestinian homeowners maintain many of the homes were built at least 20 years ago.

Under city regulations, houses older than seven years cannot be demolished even if they were built without permits. Shetrit acknowledged that because of this provision, the city would not be able to destroy many of the homes. However, he said that residents can be evicted from illegally built houses and that, despite the law, it would be easier to raze empty homes.

"It is my authority and responsibility to enforce the law," Shetrit told AP. "What would happen in a situation that I didn't act and there was an earthquake or flood and people were killed? Then you would say that the city engineer didn't carry out his responsibility and is a criminal."

He said demolishing the houses was largely a political decision.

The demolition campaign comes at a time of growing Israeli-Palestinian tensions over the fate of Jerusalem. Palestinians say Israel is trying to drive them out of parts of Jerusalem they claim as capital of a future state.

Samir Huleileh, the Palestinian Cabinet secretary, warned that the demolition plan would overshadow a planned meeting this month between Israeli Prime Minister Ariel Sharon and Palestinian leader Mahmoud Abbas.

"The Israeli side knows what kind of outcome this action will produce, and they decided [to do] it because they don't want the peace process to go ahead," he said.

Several residents have been served demolition notices, including Mohammed Badran, who received an order in February to appear in court. The order states the municipality's intention to demolish his home because it was built on land designated as "open public territory."

Badran said his home was built by his father in 1961. Pulling out reams of documents — including a tattered, yellowed Ottoman-era deed to the property — Badran points to the road in front of his house, recalling the day Israeli soldiers first walked down it in 1967.

"I was born here, my life is here. It may not be the fanciest place, it's actually the smelliest place in the city, but I want to stay in my house," Badran said.