A Palestinian Arab gunman opened fire near Ammunition Hill in central Jerusalem on Sunday morning, killing two and wounding five people.
The terrorist first opened fire from his vehicle near an Israel Police headquarters, hitting several people.
He then sped away, firing on a women sitting in her car. That victim eventually died of her injuries.
Officers who witnessed the initial attack immediately gave chase, following the assailant into the nearby Arab neighborhood of Sheikh Jarrah.
During a brief, but intense gun battle, security forces killed the terrorist, but not before he fatally wounded a special forces police officer.
Prime Minister Benjamin Netanyahu praised the heroic and unhesitating response of security forces on the scene.
Hamas said it was the terrorist who was the hero, carrying out what the group called a "natural response" to Israel's "crimes."