Mr Trump will make his pronouncement in a midday speech after months of deliberation within his administration and consultations with governments in the Middle East. But in a sign of the complexities of such a shift, White House aides emphasised that Mr Trump will sign another six-month waiver maintaining the embassy's current location in Tel Aviv because the process of moving it will take at least three or four years.
Without the waiver, which has been signed by every U.S. president for more than two decades, crucial State Department funding to the embassy would be cut off.
The president began informing his counterparts in the region of his decision Tuesday, prompting warnings from several countries that the move would inflame Muslims and disrupt progress toward a peace deal between the Israelis and the Palestinians. U.S. allies in Europe, including France, also have opposed such a change in policy, and the State Department sent a classified memo to embassies in the Middle East late last month warning of potential anti-American protests.
"Our president said, 'You don't have anything that would make up for this on Jerusalem,' " said Nabil Shaath, an adviser to Palestinian President Mahmoud Abbas who said Abbas had personally briefed him on the call. Mr Abbas told Mr Trump that he would "not accept it" and warned that the president was "playing into the hands of extremism."
But Mr Trump "just went on saying he had to do it," Shaath said.
In Riyadh, the Saudi Press Agency, using the Arabic name for Jerusalem, said King Salman bin Abdul Aziz warned Trump "that such a dangerous step of relocation or recognition of Al-Quds as the capital of Israel would constitute a flagrant provocation of Muslims, all over the world."
The backlash from other Middle East nations mounted Tuesday.
Speaking to the Turkish parliament, President Recep Tayyip Erdogan said American recognition of Jerusalem would be a "red line" for Muslims, possibly forcing Turkey to cut diplomatic ties with Israel that were recently renewed after a six-year hiatus.
Senior White House officials described Mr Trump's decision as the fulfillment of a key campaign promise that has broad bipartisan support in Congress. They emphasised that the move will not fundamentally change other aspects of U.S. policy. For example, they said, Mr Trump remains supportive of a two-state solution, if that's what the parties agree to, and the administration is maintaining the status quo on Jerusalem's holy sites.
The officials said Mr Trump is simply recognising the reality that Jerusalem has historically been Israel's capital and that most of the nation's government - including the prime minister's office, the Supreme Court and the legislature - is based there.
"For a long time, the U.S. position held ambiguity or a lack of acknowledgment in hopes of advancing the process of peace," said one senior administration official, who along with two others spoke on the condition of anonymity at a briefing for reporters at the White House on Tuesday. "It might have been reasonable under certain circumstances and times. Certainly, it's been tried. But . . . it seems clear now that the physical location of the American embassy is not material to a peace deal."
Another U.S. official said after the briefing that while Mr Trump will reiterate his commitment to the peace process during his speech, the White House recognises that "some parties" might react negatively.
"We are still working on our plan, which is not yet ready," said this official, who was not authorised to speak on the record. "We have time to get it right and see how people feel after this news is processed over the next period of time."
No other countries have their embassies in Jerusalem, with a long-standing international consensus that the city's status should be decided in a peace deal between the Israelis and the Palestinians.
Palestinian factions jointly announced three "days of rage," beginning Wednesday, to protest the potential U.S. Embassy move and recognition of Jerusalem. In a statement, they called on supporters around the world to gather in city centers and at Israeli embassies and consulates to voice their anger.
In a statement late Tuesday, the U.S. Consulate in Jerusalem urged American citizens in Israel to avoid large crowds or areas where security had been increased, and ordered its staff members and their families to avoid Jerusalem's Old City and the West Bank except for "essential" business.
Israel annexed East Jerusalem, which contains most of the important holy sites for Jews, Muslims and Christians, after the 1967 war with Arab powers. Palestinians claim East Jerusalem as the capital of a future state, while many Israelis and some in the United States consider the city sector to be already and irrevocably under Israeli administration. Some of Mr Trump's prominent Jewish backers appear to hold that view, although he has said he wants to honour Palestinian sovereignty through a mutual settlement.
U.S. officials did not identify any prospective location for the new embassy, and said it will take years to plan and build to meet security concerns for the roughly 1,000 diplomats currently headquartered in Tel Aviv. But the officials emphasised that the move will not prejudice Palestinians' claims to East Jerusalem, strongly implying that only sites on the western side of the pre-1967 Green Line will be considered.
"This doesn't speak to final-status issues," a third administration official said, referring to the thorniest disputes in the Israeli-Palestinian conflict - those that are assumed to be in limbo until completion of a final peace settlement.
The officials said the decision was made with the support of Trump's envoys seeking a long-elusive peace deal, an assertion meant to counter warnings that the change would unleash fresh Arab violence. They offered no specifics to support the claim that the move would not spoil the peace initiative headed by presidential son-in-law and adviser Jared Kushner.
The aides said, however, that Secretary of State Rex Tillerson and other State Department officials were closely involved in the deliberations.
The White House said a call was also scheduled with Israeli Prime Minister Benjamin Netanyahu. A spokesman for his office declined to comment.
Other advocates of recognising Jerusalem as the Israeli capital have pointed to Russia as an example. Moscow declared West Jerusalem to be the Israeli capital earlier this year, and the announcement produced no wave of violence or diplomatic backlash.
The U.S. position is more charged, however, because of Washington's historic role as a peace broker.
Jordan's King Abdullah II said the move would undermine U.S. efforts to resume the peace process, according to news reports.
The Egyptian government said President Abdel-Fattah el-Sissi, in his conversation with Mr Trump on Tuesday, "reiterated Egypt's unwavering position with regard to maintaining the legal status of Jerusalem within the framework of international references and relevant U.N. resolutions.
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Morris and Ruth Eglash reported from Jerusalem. Gearan reported from Berlin. Heba Farouk Mahfouz in Cairo contributed to this report.