The United Nation's cultural arm has voted to grant the Church of the Nativity world heritage status.
Thirteen countries backed the Palestinian delegation at the Unesco vote in St Petersburg on Friday, giving the Bethlehem church protected status.
The Palestinians submitted the request "on an emergency basis" soon after gaining membership of the organisation last October.
Israel's delegate at the meeting said that while the Jewish state supported awarding the church heritage status in the future, it did not support the way in which it was done. For the Palestinians, the vote will be seen as an admission that the church is under threat from Israeli soldiers.
"The decision taken now was totally political and does great damage in our opinion to the (UN) convention and its image," said Israel's representative.
Abraham Foxman, national director of the Anti-Defamation League, accused Unesco of being "another hackneyed, politicised body".
He said: "We do not dispute that the Church of the Nativity is a treasured and sacred site that could qualify for special status.
"We dispute the process, which supported the Palestinian’s cynical strategy to circumvent World Heritage procedures and facetiously claim the site to be endangered. In bowing to this perverted Palestinian bid, the committee ignored the recommendations of their own advisory council’s investigation and the entreaties of the church’s own religious leadership who must live with the practical implications of this decision."