In a statement released yesterday, the Israeli Foreign Ministry said an embassy security officer shot dead a Jordanian worker replacing furniture at the embassy after the worker attacked him from behind with a screwdriver.
Jordan is now refusing to allow the wounded guard to leave for Israel, despite his diplomatic immunity.
The shooting came at a time when Israel and Jordan were conducting intense contacts over an escalating crisis at a contested Jerusalem shrine that is revered by Muslims and Jews.
"The investigation is still in its initial stage and a broader probe has been opened by PSD investigators to look into all the details of the incident and the public prosecution department has been notified", the police said.
Israel reportedly tried to evacuate its diplomatic staff following the attack but was prevented from doing so by the Jordanians, who want to question the guard. Jordan is the custodian of the mosque.
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The security source in Amman had confirmed earlier that two Jordanians were killed in a shooting in the area of the embassy.
In a statement posted on Facebook prior to the attack, the assailant said he was motivated by the Israeli government's recent restrictions on al-Aqsa mosque in Jerusalem, according to an Israeli military spokesman. The guard shot and killed his attacker, a 17-year-old Jordanian.
Israeli measures at the flashpoint site sparked angry demonstrations in Amman on Friday, when thousands took to the streets in a protest.
The Jordanian ambassador to Israel met at the Foreign Ministry in order to help resolve the matter, Netanyahu said.
Violence flared between Israeli security forces and Palestinians who are demanding that Israel remove metal detectors installed outside the site after the attack. The gunfire killed the Jordanian man and injured the Jordanian landlord of the building who was also present at the time.
Muslim religious leaders have said that Israel is trying to expand its control at the site under the guise of security, a claim Israel denies. It has always been a flashpoint of anti-Israeli protests at times of turmoil in the Palestinian territories.