The Muslims have other ideas. They insist they will build a massive mosque on the same site, with a 325-foot-high minaret that would overshadow the conical dome of the Church of the Annunciation, the main Christian shrine in Nazareth. The conflicting plans have sparked a bitter religious feud, shattering the place where Jesus grew up. Nazareth used to be a harmonious town, with 20,000 Christians and 48,000 Muslims living in the same neighborhoods. Now flak-jacketed Israeli police patrol the streets, hoping to stem outbreaks of violence. “Something is broken between Muslims and Christians,” says Khaled Zoabi, a local lawyer. “Our bonds are broken.”

The conflict began as a mundane piece of political opportunism. In December 1997, Mayor Ramzi Jeraizi demolished an old school next to the tomb of Shihab ed-Din and announced plans for the piazza. It is part of a $100 million face-lift in preparation for the 2.5 million pilgrims expected next year. But the mayor picked a very sensitive spot, and Islamic politicians took advantage. Shihab ed-Din–warrior and nephew of Salah ed-Din, who beat the Christian Crusaders out of the Holy Land in the 12th century–is an Islamic hero, and Muslims do not want his crypt desecrated. The black-tarpaulin protest tent went up 16 months ago, and Muslims raised $20 million to build a mosque on the site. Tensions have slowly risen. On Easter Sunday, 20 people were injured in street battles near the tomb. First Christian, then Muslim, shops were firebombed, and Christians were stoned in their cars. Says Jeraizi: “Christians are very frightened.”

The government hasn’t been much help. Avi Blustein, director general of the Reliious Affairs Ministry, caused an uproar when, citing Vatican sources, he said that the pope might cancel his visit–and the Vatican might close all churches in Israel if the mosque is built. The Religious Affairs minister suspended Blustein, but couldn’t hide Rome’s displeasure at the plans for the mosque, which the Holy See calls “a provocation.” The Franciscan order, custodian of Christian holy places, closed Nazareth’s biggest church for two days in early April to protest the “atmosphere of fear” in the town.

Nazareth had big plans for Jesus’ 2,000th birthday. More than 1,000 new hotel rooms are being built. The sewage-strewn market has been renovated. The Tourism Ministry said it will “change Nazareth back into the picturesque village that the Western pilgrim imagines it to be.” Local merchants hope the tourist influx will boost a weak economy. But business concerns have been eclipsed by what Jeraizi calls “all this dirty playing.” The consensus in town is that the Muslims may get their way–in part because Jeraizi is a lame duck. In elections last November, Muslim fundamentalists gained control of the city council.

Israel’s minister in charge of Arab affairs, Moshe Katsav, has proposed a compromise: a mosque half the size of the one drawn up by the Islamists. But Muslim and Christian politicians accuse him of trying to play the two sides off against each other. Israeli cabinet ministers will meet this week to discuss the issue. While both Muslims and Christians distrust the government, nobody is in a conciliatory mood. “If they take this land,” says Rashid Zoabi, a Muslim, “Nazareth will be destroyed.” That’s not quite the message the “picturesque village” wants to send as the millennium nears.