About 450 thousand Palestinian Arabs lived in cities in 1947. These urban communities accounted for a third of the Palestinian Arabs as a whole. 65,000 people, about a seventh of the total urban population, were living in Jerusalem, or al-Quds. Nevertheless, the political, religious, social, cultural, and even economic importance of Jerusalem for the Palestinian Arabs was far more important than its ratio in their population. The Palestinian Arab viewpoint regarding the events of 1948 Nakba cannot be comprehended without studying Jerusalem. By the end of the civil war, in mid-May 1948, some 30,000 Palestinian Arabs had left western Jerusalem. Previous research has regarded it as an ignominious defeat, foretold by the balance of power with the Jewish Zionist community in Palestine. In contrast, this paper claims that the Arab military forces and local institutions in Jerusalem proved able to defend the Old City and some of the northern Palestinian Arab neighborhoods. Following the British evacuation on 14 May they averted collapse, thus forestalling the exodus of the entire population prior to the arrival of the Transjordan Arab Legion on 19 May. In consequence, East Jerusalem remained under Arab rule until 1967, and has in fact remained Palestinian Arab to this day. To prove the main hypothesis, the paper will use sources such as Arabic and other archival documents, press of the time, memoirs and diaries.