Jerusalem (AFP) - Israeli police on Tuesday evicted a Palestinian family from the east Jerusalem home in which they lived for over half a century, making way for Israelis deemed the legal occupants.

Plans for the eviction had been criticised by the European Union, United Nations and various Western governments, though not the United States.

Fahamiya Shamasneh, 75, told AFP police arrived unannounced before dawn and forced her out of the house along with her husband Ayoub, 84, their son and his family.

The couple had lived in the house in the Sheikh Jarrah neighbourhood of east Jerusalem near the historic Old City for 53 years.

An AFP journalist saw young Jewish men moving into the building after the family were escorted out.

"It is the hardest day," Fahamiya Shamasneh said tearfully on the street after being evicted.

She said she was heating milk for her grandchildren when "they knocked on the door and said 'open its the police'.

"They took us out and threw us outside.

"What greater injustice is there than this? Maybe we will sleep in the street."

The United Nations agency for Palestinian refugees, UNRWA, said it would seek to support the family financially to find another home.

The Shamasnehs had for years been fighting a court battle against Jewish claimants who said the building was their family property, which they fled when east Jerusalem was occupied by Jordanian troops in the 1948 war that led to the creation of the Jewish state.

Under Israeli law, if Jews can prove their families lived in east Jerusalem homes before the 1948 war they can demand that Israel's general custodian office release the property and return their "ownership rights".

During that war, thousands of Jews fled Jerusalem as Jordanian-led Arab forces seized the city, while hundreds of thousands of Palestinians fled from land that was later to become Israel.

No such law exists for Palestinians who lost their land.

- 'Dangerous trend' -

The Shamasnehs say they had paid 250 shekels ($70) a month to the general custodian since 1967, an arrangement used by the settlers' side as proof that the family acknowledged its status as tenants.

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In 2013 the Israeli Supreme Court ruled in favour of the Jewish claimants.

Tuesday's eviction was the first in the neighbourhood since 2009, according to Israeli anti-occupation group Peace Now.

Israel sees Jerusalem as its undivided capital, while the Palestinians want the eastern sector as their future capital.

Israel occupied east Jerusalem in the Six-Day War of 1967 and later annexed it in a move never recognised by the international community.

Around 200,000 Israeli Jews now live in east Jerusalem in settlement homes considered illegal under international law.

Scott Anderson, head of UNRWA's West Bank operations, said such expulsions made peace between Israelis and Palestinians harder to achieve.

"We all support the two-state solution and a negotiated peace process. The expansion of settlements is not helpful to that end," he told AFP.

Peace Now says the house is part of a larger process of establishing settlements in Sheikh Jarrah.

"The eviction of the Shamasneh family, who resided in the house since 1964, is not only brutal but it is also indicating a dangerous trend that could threaten a future compromise in Jerusalem," the Israeli NGO said in a statement.

Arye King, director at the Israel Land Fund and a de facto spokesman for much Jewish settlement growth in Jerusalem, told AFP last month he wanted the area to go "back to being a Jewish neighbourhood".

"It is happening slowly, slowly," he said.