Although there are several stumbling blocks to peace, Jerusalem is the most central, critical and contentious issue that divides Arabs and Israelis. Spiritually, demographically and politically Jerusalem is at the heart of the Arab-Israeli conflict. Both sides have made it clear that any two-state solution must include Jerusalem as the capital and seat of government for both parties. Religion and history make sharing bitterly difficult. The world has invented a multitude of peace plans, but none has stuck. A viable plan must be developed and agreed to by both sides to make any real lasting progress towards peace. The problem-solving methodology was used to conduct this research. First, research into the history of Palestine and Jerusalem and its role in Judaism, Christianity and Islam was conducted to determine how history lends legitimacy to the claims made by both parties to the land of Palestine. Similarly, research into the Zionist movement and the resulting Arab nationalist movement was conducted to understand why both people want Jerusalem as their national capital, why the hatred is so strong and how these movements make solving Jerusalem difficult.