Associated Press footage showed police throwing stun grenades to disperse protesters in Ras al-Amud, a neighborhood in the eastern part of the city. An officer could be seen kicking a man as he kneed on a mat.
Police said Palestinians threw stones at officers.
Hundreds prayed at the shrine compound, sacred to both Muslims and Jews, police said. Friday prayers typically draw tens of thousands.
Israel installed metal detectors at gates to the site after Palestinian gunmen killed two policemen there last week.
Palestinian Muslim leaders claim the devices are an Israeli attempt to expand control over site. Prayers have been held in the streets in protest. Israel denies the allegations saying the devices are to prevent more attacks.
Sporadic scuffles erupted elsewhere in Jerusalem.