Israel’s Supreme Court rejected a petition filed by left-wing Ir Amin to prevent the annual Jerusalem Day march passing though the Muslim Quarter of the Old City this week.
Thousands of Zionist teens mark the reunification of Jerusalem but the event has caused tension between Jews and Arabs.
Judges noted police may struggle to combat incitement but would protect Arab residents and shopkeepers in the area.
The court reportedly rejected a petition to reverse a decision to ban Jews and tourists from Temple Mount, the first time it will be closed in 30 years.
The site is shut on the last days of Ramadan, this year it falls on Jerusalem Day.
Police said the site will be closed for public safety.
Jews can visit Temple Mount but are not permitted to pray or display Jewish symbols.