The Jerusalem magistrates' court had in March found Sheikh Omar Abu Sara, 51, guilty of incitement to violence and racism in a sermon he delivered at the Al-Aqsa mosque compound.
In his November 28, 2014 sermon, which was also uploaded to YouTube, Abu Sara said "the Jews" were treacherous, stubborn, murderous, rude and shameless, while also calling them "monkeys and pigs".
"I'm telling Jews explicitly -- it's time to slaughter you, time to fight you, time to kill you," he said, according to a transcript of the speech in the court decision.
The sermon came against the backdrop of months of unrest over perceived Jewish attempts to take control over the holy site, which Jews refer to as the Temple Mount and consider their most sacred.
There were also tensions over the murder of a Palestinian teenager in July in revenge for the killings of three Jewish teenagers in the West Bank.
The killings were part of a cycle of violence that led up to the 2014 war between Israel and Palestinian militants in Gaza.
Abu Sara claimed the sermon should not be considered incitement to violence and racism since it was based on religious scriptures and teachings and contained "general and non-binding" statements, the decision said.
The Islamic Waqf organisation, which administers the Al-Aqsa compound, the third-holiest site in Islam, told AFP it as not aware of a preacher there by that name.
The sentence is to begin on December 18, 2016, the court said, and Abu Sara can appeal within 45 days.
The Jewish high holidays in October see a rise in Jewish visitors to the site, and authorities were bracing for an increase in violence in and around east Jerusalem.
Israel says most of the Palestinians killed were carrying out knife, gun or car-ramming attacks. Others were shot dead during protests or killed in Israeli air strikes on Gaza.
Many analysts say Palestinian frustration with the Israeli occupation and settlement building in the West Bank, comatose peace efforts and their own fractured leadership have helped feed the unrest.
Israel says incitement by Palestinian leaders and media is a main cause of the violence.
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