An army spokeswoman told AFP that crossings to Israel from the West Bank and Gaza Strip would be closed for Palestinians in all but "medical and humanitarian cases".
She said the closure would remain in force until midnight on Sunday.
The measures came during the first Friday of the Muslim holy month of Ramadan, when tens of thousands of Palestinians visit the Al-Aqsa mosque compound in Jerusalem to pray.
The worshippers had to return home after Friday prayers, the spokeswoman said.
Palestinian men between 12 and 35 were not allowed to enter the mosque, with those between 35 and 45 needing permission and those older than 45 having unrestricted access, police confirmed.
Passage was unrestricted for women.
Sheikh Azzam al-Khatib, head of the Islamic Waqf which administers Al-Aqsa, said 100,000 people attended today prayers, down from more than 200,000 the year before.
Prime Minister Benjamin Netanyahu convened his security cabinet on Thursday and announced a slew of measures against Palestinians after Wednesday's shooting in a popular Tel Aviv nightspot, the deadliest attack in a months-long wave of violence.
Among the measures, the government said it was revoking entry permits for more than 80,000 Palestinians to visit relatives in Israel during Ramadan.
It also revoked work permits for 204 of the attackers' relatives and the army blockaded their West Bank hometown of Yatta, with soldiers patrolling and stopping cars.
United Nations rights chief Zeid Ra'ad Al Hussein's office in a statement on Friday condemned the attack but said the Israeli measures may amount to "collective punishment".
"The measures taken against the broader population punish not the perpetrators of the crime, but tens - maybe hundreds - of thousands of innocent Palestinians," it said.
Newly installed Defence Minister Avigdor Lieberman ordered that the bodies of Palestinians killed while carrying out attacks would no longer be returned to their families for burial, a spokesman said.
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