The Jerusalem city authority has erected a fence in a nursery school playground to separate ultra-orthodox Jewish children from a secular Jewish kindergarten that shares the same building and garden.

The wire fence is to be covered with sheeting to block visibility from one part of the playground to the other.

The nursery schools are in the Kiryat Yovel neighbourhood of Jerusalem, an area that has seen a growing ultra-orthodox population in recent years, to the dismay of many local secular Jews.

The secular kindergarten, Pashosh, opened in September with the aim of attracting more secular families to the area. But ultra-orthodox parents have complained that the female staff of Pashosh are immodestly dressed and that they do not want their children mixing with children from a non-religious background.

"They don't want to see us because of the way we dress," said Mika Lavi, a teacher at Pashosh, who was wearing trousers and a close-fitting, long-sleeved jumper. In warm weather, she said, her arms were usually exposed.

"I cried when I saw the fence. These children are very small. I had hoped that we could live in peace together. If we separate the children at such an early age how will they learn to live together?"

Pashosh has about 10 children aged under two. The ultra-orthodox nursery school has about 20 boys and 20 girls, in separate rooms with separate entrances, aged three to four. Staff at the ultra-orthodox kindergarten declined to speak to the Guardian.

One ultra-orthodox parent, picking up her daughter, said she was saddened by the fence but reluctantly accepted its necessity. "I don't want my children to see immodest women," said the mother, who did not want to give her name.

"I spoke to one of the teachers at the other school and asked her to think about how she dressed for the sake of good relations. She wasn't interested in seeing our point of view – she said: 'Don't tell me how to dress; I am free to dress how I please.'"

The mother said parents who had lobbied the Jerusalem officials to erect the fence were mostly recent immigrants to Israel from Europe who were uncompromising in their religious beliefs. "This is now the face of Israel, the way we are, even Jewish communities are divided," she said.

The Jerusalem city authority declined to answer questions about the fence but issued a statement saying that "with the aim of meeting the needs of all of the neighbourhood's pupils, both secular and ultra-orthodox, the [municipality] decided to divide the existing building ... The fence will be built as part of a wider perspective that provides for the quite different needs of the community as a whole."