Malaysia's former PM Mahathir Mohamad called US President Donald Trump a villain for his move to recognise Jerusalem as Israel's capital. Picture: AP Photo/Vincent Thian

Kuala Lumpur - Muslim-majority Malaysia's former prime minister Mahathir Mohamad on Friday called US President Donald Trump an "international bully" and a "villain" for his move to recognise Jerusalem as Israel's capital.

Trump last week reversed decades of US policy by recognising Jerusalem as the capital of Israel, and said the United States would move its embassy to Jerusalem from Tel Aviv in the coming years.

The status of Jerusalem is one of the thorniest barriers to a lasting Israeli-Palestinian peace. Israel considers Jerusalem its eternal and indivisible capital and wants all embassies based there.

Read more: Netanyahu expects Europe to follow Trump's #Jerusalem decision

Palestinians want the capital of an independent state of theirs to be in the city's eastern sector, which Israel captured in the 1967 Middle East war and annexed in a move never recognised internationally.

The anger from Trump's decision "will lead to what is called terrorism", the 93-year-old Mahathir told a a protest rally in front of the US embassy in Kuala Lumpur.

"Today we have an international bully. Trump, go find someone your own size. This (Jerusalem plan) will only stir the anger of the Muslims," said Mahathir, the chairperson of Malaysia's opposition coalition.

"We must use all our power to oppose this villain who is the president of the United States," he said, urging all Muslim countries to cut ties with Israel.

Also read: Trump, US face global condemnation after #Jerusalem decision

Muhyiddin Yassin, another opposition leader, called on the Malaysian government to not proceed with planned investments in the United States.

Last week, Malaysian Prime Minister Najib Razak urged Muslims worldwide to oppose any recognition of Jerusalem as Israel's capital.

Social media users in Muslim-majority Malaysia vowed to boycott US companies, such as McDonald's Corp, following Trump's decision. The chain's Malaysian franchise said it did not support or engage in any political or religious conflicts.

Deputy Prime Minister Zahid Ahamd Hamidi on Friday said Najib and the leader of the opposition Pan-Malaysian Islamic Party (PAS) would lead a protest rally next Friday in Malaysia's administrative capital of Putrajaya, media said.