Netanyahu, who has called Bolsonaro his "friend" and invited him to visit Israel, called it a "historic, correct and exciting step".
"These are provocative and illegal steps that will only destabilize security and stability in the region", Hanan Ashrawi, a member of the Palestine Liberation Organization's executive committee, told AFP.
The United States moved its embassy to Jerusalem in May, enraging Palestinians and key Muslim leaders.
"As previously stated during our campaign, we intend to transfer the Brazilian Embassy from Tel Aviv to Jerusalem".
'Israel is a sovereign state and we shall duly respect that'.
The Palestinians cut off ties with the Trump administration after the decision was first announced in December 2017, saying the government's pro-Israel bias meant it could no longer lead peace negotiations between themselves and Israel.
Paraguay briefly moved its embassy to Jerusalem only to move it back to Tel Aviv after its new president, Mario Abdo Benitez, was elected.
"We reject the Brazilian president-elect's decision to relocate the embassy from Tel Aviv to al-Quds", Hamas spokesman, Sami Abu Zuhri, wrote on his official Twitter page on Friday.
Israel considers the entire city its capital, while the Palestinians see east Jerusalem as the capital of their future state, with global consensus being that the status of the whole city must be negotiated between the two sides.
Israel regards Jerusalem as its "eternal and undivided" capital, while the Palestinians claim East Jerusalem - occupied by Israel in the 1967 Middle East war - as the capital of a future state.
Palestinians say that moving the embassy would prejudge one of the most sensitive issues in the conflict - the status of Jerusalem - and undermine the US' status as an honest mediator.
Bolsonaro, 63, who won a runoff election on Sunday, has outraged many with his overtly misogynistic and racist rhetoric.
Take-Two Has Second Largest Video Game Launch of All Time
I'm holding to that prediction, although I do expect it to be a pretty tight race between it and Call of Duty: Black Ops 4 . Red Dead Redemption 2 released last week to much critical acclaim, but the consumers have finally spoken.
De Bruyne out for up to six weeks
They know how we want to protect them. "We have a very good opinion of him". "We are a stronger team with Kevin than without him". Manchester City confirm that midfielder Kevin De Bruyne will be sidelined until December after sustaining a fresh knee injury.
Samsung might remove Headphone jack from Galaxy S10
The hinge will also feature an internal gear mechanism that allows the user to fold out the screen at different angles. Samsung is expected to launch the Galaxy S10-lineup early next year and looks like Samsung is packing some surprises.