British Prime Minister David Cameron condemned as "appalling" Wednesday the killing of a Palestinian teenager in an apparent revenge attack after three Israeli youths were murdered.

He also urged Israel and the Palestinians to exercise restraint as tensions rise.

At least 65 people were hurt in clashes between Palestinians and Israeli police in riot gear outside the teenager's house and Israeli police have raised the alert to the second highest level countrywide.

"I'm appalled by the murder of a Palestinian teenager," Cameron wrote on Twitter. "The loss of four boys this week is a terrible reminder of the need for lasting peace."

British Foreign Secretary William Hague also condemned the killing of the Palestinian teen and said it was "vital that the people responsible for this crime are held accountable."

Mohamed Abu Khder, 16, was kidnapped and killed in Jerusalem on Wednesday.

Palestinian leaders hold Israel responsible for the attack, which is believed to have been carried out in revenge for the kidnap and killing of three Israeli teenagers.

Gilad Shaer and Naftali Frenkel, both 16, and 19-year-old Eyal Ifrach disappeared from a roadside in the West Bank on June 12. Their bodies were found Monday.

Israel has blamed Hamas militants for the deaths.

Cameron has condemned the killing of the Israeli teenagers as an "inexcusable act of terror".

"I think it's very important Britain will stand with Israel as it seeks to bring to justice those who are responsible," he told parliament Wednesday.

"We also welcome the fact that (Palestinian president Mahmoud Abbas) has firmly condemned the abduction and actually tried to help find these people.

"It is important... all security operations are conducted with care so that further escalation is avoided."