Speaking at an Arab League summit in Libya Abbas said, "Jerusalem is the jewel of the crown and the key to peace – harming it will ignite fire."
"It is impossible to continue with peace efforts while construction resumes in the settlements. Saving Jerusalem from its 'Jewification' is a duty bestowed on each and every one of us," said Abbas.
"We emphasize that we will cling on to every grain of soil and every stone in Jerusalem. There will be no agreement that does not guarantee the end of the Israeli occupation of our land, especially holy Jerusalem as the capital of the Palestinian state."
The Palestinian president also mentioned a number of actions he wanted taken against Israel internationally. "We must call on the international community and the Security Council not to recognize any one-sided moves made by Israel in Jerusalem and make it responsible for stopping these moves, especially in the Al-Aqsa mosque, Jerusalem, and Bethlehem," he said.
Abbas added that UNESCO should be asked not to recognize Israel's list of national heritage sites, which includes locations in the West Bank and east Jerusalem.
"We must also appeal to the Security Council to condemn Israel and recognize it as an occupying force in Jerusalem. We must gather Arab and Muslim support in order to stop Israel's actions in Jerusalem, especially its acts of aggression at the holy sites," the Palestinian president said.
He also demanded additional financial aid of a sum of $500 million for Palestinians in Jerusalem in order to "assist them in holding on to their land".
Abbas said the Palestinians were willing to launch peace talks but that "we cannot continue efforts for peace while the construction in settlements continues".
"We must force the Israeli government to announce a clear stance regarding two states with the 1967 borders. I say two states because Israel does not believe in this and is not working towards this," he said.
The 22nd summit was attended by just 13 of 22 leaders of Arab states. It was hosted by Libyan leader Muammar Gaddafi.