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Everybody has heard of Jerusalem ( Yerushalayim in Hebrew, al-Quds in Arabic), and most people have some image of it in their heads, but almost everyone who comes here is surprised at what they find. Sacred to three religions and once considered to be the centre of the world, the Holy City is, for all its fame, quite a small town, far from opulent, provincial in many ways and conservative in outlook. But if it fails to live up to its fabled magnificence, it is still a fascinating place, full of museums, religious sites and ancient relics, at their densest in the Old City, where almost every building has a story. Here you'll find three of the world's most venerated institutions: the Church of the Holy Sepulchre , held to be the location of the Crucifixion, and the holiest site in Christendom; the Western (Wailing) Wall , last remnant of the Second Temple and most sacred Jewish relic in the world; and the Dome of the Rock , third most hallowed location in Islam as the spot from where the Prophet Mohammed made his night ascent to heaven.

Even without these monuments, and even to a non-believer, Jerusalem has much to offer - from the narrow alleys and vibrant souqs of the magnificent walled Old City , within which lies the Via Dolorosa (the path taken by Jesus to the Cross), to the churches and tombs of the Mount of Olives , and the expensive shops and lively bars of downtown West Jerusalem. In fact, Arab East Jerusalem and Israeli West Jerusalem offer the visitor two worlds for the price of one: the tradition and relaxed pace of the Arab world, and the cosmopolitan glitz of the West. And the Palestinian fellahin and Bedouin who meet their urban compatriots in the markets and shops of the East, and the Israeli farmers (from kibbutzim and moshavim in the foothills and the plain) who do much the same in the West, add further to the diverse cultural mix.

Perched high in the Judean Hills , the city's location is equally captivating. The view on approach is dramatic, with even the modern city providing a magnificent array of white high-rises gleaming in the sunlight - an architectural legacy of the first British governor, who declared that all new buildings must be made from local limestone, a ruling followed under subsequent Israeli and Jordanian rule. To its west lie the fertile planted fields, olive groves and settled villages of the coastal plain and the Judean foothills, while to the east the harsh desert of the Jordan Valley stretches out to a horizon that, on a clear day, offers glimpses of the Dead Sea.

As far as politics is concerned, Jerusalem is at the heart of the Israel-Palestine question, hotly contested and deeply divided. It may be one city, but it's definitely two countries, and if the Israel-Jordan border that once ran through the city no longer exists in physical form, the political, legal and above all cultural divisions are still very tangible. The two halves live uneasily side by side, a tension heightened by the construction of new Jewish settlements that encroach upon Palestinian land. Though Israel has taken the position since 1967 that Jerusalem is the single, indivisible capital of the Jewish state, it's a status recognized by few other countries, so while the Knesset is in Jerusalem, virtually all foreign embassies remain in Tel Aviv. Meanwhile, the Palestinians also consider Jerusalem their true capital - however unrealistic that may seem - and it remains the focus of their commerce, culture, political aspirations.

Jerusalem then is a schizophrenic city, a frustrating and complex place that can seem overwhelming on a first visit. In fact, such is the emotion that the city inspires in some visitors that it has its own mental disorder: some victims of Jerusalem Syndrome suffer the delusion that they are characters from the Bible - Jesus is the favourite, but others include Moses, King David, Elijah, John the Baptist and the Virgin Mary. You might see them wandering the streets, dressed in the robes of their adopted persona. Other sufferers commit bizarre acts in their certainty of the imminent Second Coming - in 1969, an Australian tourist tried to burn down the al-Aqsa Mosque in preparation for Jesus's arrival.

Despite its very real difficulties however, Jerusalem is still a beautiful city, teeming and alive, a historical location without compare and the backdrop against which the histories of three religions were acted out. It was from here that Mohammed ascended to heaven, from the spot where God tested Abraham by asking him to sacrifice his son. It was the residents of this city who welcomed Jesus by spreading palm leaves on the ground before him, along these streets that he dragged the cross, and here that he was executed upon it. Here, too, stood the capital of David and Solomon, home to the two Jewish Temples of antiquity; and this is the city for which the Jews through all their centuries of exile and persecution cried their ancient hope, "next year in Jerusalem". Little wonder that it inspires such dreams, such devotion, such love, such madness.

Around Jerusalem too are a number of fascinating places that are easily reached on outings. Of these, the ancient fortress of Masada gets many a visitor out of bed by 3am for the ever-popular excursions to climb it at dawn and see the sun rise from the top, before checking out that bizarre natural phenomenon, the Dead Sea (for those who value their lie-in there are more leisurely ways to see both). Nearer at hand, David's royal city of Bethlehem , the biblical birthplace of Jesus, is almost within walking distance, and a mere twenty minutes away by service taxi. Jericho , the city whose walls came tumbling down, takes a little more getting to, but still lies only an hour to the east. Westward, meanwhile, the village of Abu Ghosh attracts lovers of fine Middle Eastern food as much as those with an interest in history, and not far beyond, Emmaus and Latrun are sites with resonances ancient and modern respectively.