"My announcement today marks the beginning of a new approach to conflict between Israel and the Palestinians," Trump said from the White House, where he was joined by Vice President Mike Pence. Trump described it as a "long overdue step to advance the peace process."
"While previous presidents have made this a major campaign promise, they failed to deliver," he added. "Today I am delivering."
His remarks were broad in nature — an intentional choice, according to a U.S. official and a source close to the White House who spoke to ABC News before the announcement.
Trump said Wednesday that "the U.S. would support a two-state solution if agreed to by both sides."
"Jerusalem is not just the heart of three great religions, but it is now also the heart of one of the most successful democracies in the world," Trump said. "Over the past seven decades, the Israeli people have built a country where Jews, Muslims, Christians and people of all faiths are free to live and worship according to their conscience and beliefs."
Until the new embassy in Jerusalem opens, current law requires the president to sign a waiver that keeps the embassy in Tel Aviv operable. The process of relocating the embassy is expected to take years.
Trump said the process of hiring "architects, engineers and planners" will begin "immediately." The new embassy "will be a magnificent tribute to peace," he added.
Secretary of State Rex Tillerson said in a statement after Trump's speech that "the State Department will immediately begin the process to implement" the decision to move the embassy. He added that "the safety of Americans is the State Department's highest priority" and that the department has "implemented robust security plans."
The approach described by the officials appears aimed at allowing Trump to fulfill a key campaign promise while attempting to reduce fallout from the decision by delaying it for an undefined time.
"While we understand how some parties might react, we are still working on our plan, which is not yet ready," a senior administration official said. "We have time to get it right and see how people feel after this news is processed over the next period of time."
A senior official downplayed concerns about threats of violence to U.S. citizens overseas as a result of the announcement, saying proper precautions have been taken.
"We're obviously concerned about the protection of U.S. citizens, U.S. officials anywhere in the world," an official said, adding that U.S. security agencies have been involved in the decision and are prepared to provide extra security if necessary.
From the White House, Trump addressed the possibility of unrest, calling for "calm" and "moderation" and "for the voices of tolerance to prevail over the purveyors of hate."
"Let us rededicate ourselves to a path of mutual understanding and respect," he said.
A number of world leaders, including Pope Francis, spoke out against the decision Wednesday. Francis' comments came during a previously scheduled meeting with a Palestinian delegation of religious and intellectual leaders before Trump's address.
"My thoughts now go to Jerusalem," Francis said. "In this regard, I cannot keep silent about my deep concern over the situation that has arisen in recent days and, at the same time, a heartfelt appeal so that everyone would be committed to respecting the status quo of the city, in accordance with the relevant resolutions of the United Nations.”
French President Emmanuel Macron called the action an "unfortunate decision" and said, "France does not approve it."
"It goes against international law and the resolutions of the U.N. Security Council," he said. "The status of Jerusalem is a security issue for the entire international community. The status of Jerusalem must be determined by Israelis and Palestinians in the framework of negotiations under the auspices of the United Nations."
"He's encouraged by the progress his peace team has made so far. I know a lot of that progress isn't visible. I think that's one of the things — I know he believes, and I know the peace team believes it's partly because that progress is not visible that they've been able to make so much progress," the official said.
ABC News' Devin Dwyer and Paul Pradier contributed to this report.