JERUSALEM, Nov 3 (Reuters) - Jews took over another house in Arab East Jerusalem on Tuesday in what Palestinians say is a systematic campaign to drive them out and strengthen Israel's hold on all of Jerusalem.

The house, built 10 years ago by the al-Kurd family, is the seventh this year to be awarded to Jewish settlers following legal battles in the Israeli courts, where the Palestinians say a fair hearing is impossible to obtain.

The houses, in a predominantly Palestinian district, now fly the Israeli flag and are protected by men with guns.

The al-Kurd house was unoccupied and locked for eight years by court order pending settlement of a land-ownership dispute.

Police kept members of the family back as a dozen Israeli men removed furniture.

"They can go to Syria, Iraq, Jordan. We are six million and they are billions," said Yehya Gureish, an Arabic-speaking Yemen-born Jew who said his family owned the land and had Ottoman Empire documentation to prove it.

"This land is Israel. We are in Israel. God gave this land to the Jews. The Torah tells us so. You want war? Declare war on God, not on us," he said.

Israel annexed East Jerusalem after capturing the area in a 1967 war and regards all of the city as its capital, a claim not recognised internationally. Some 200,000 Jews live in East Jerusalem, alongside about 250,000 Palestinians.

Palestinians, who want East Jerusalem as the capital of a state they hope to create in the West Bank and Gaza Strip, say they have little chance of winning property cases in Israeli courts or reclaiming land or homes in West Jerusalem and Israel.

The home takeover was filmed by an activist from the pro-Palestinian International Solidarity Movement, whose video includes some cursing and a brief scuffle, but no violence.

"I am Jerusalemite, a Palestinian. I didn't come from all over the world," said Rifka al-Kurd, who had the house built 10 years ago for her married daughter.

A group of Orthodox religious Jews watched the scene from the rooftop of a nearby house they took over in early August, on the same day as its Palestinian residents were evicted onto the street. An Israeli flag fluttered from the roof.

Also watching were members of the al-Ghawi family, who have symbolically camped on the sidewalk next to their former home for three months in a protest against eviction. Their tent was broken up by Israeli police last week but they set it up again.

The United States and the United Nations have demanded Israel stop evicting Palestinians in East Jerusalem or demolishing their homes.

Israel says it is on solid legal ground in tearing down structures built without permits. Palestinians says building permission is impossible to obtain from Israeli authorities. (Writing by Douglas Hamilton; Editing by Myra MacDonald)