J By Alissa J. Rubin

ERUSALEM – At first glance, few places on Earth seem like better candidates for a museum of tolerance than Israel, where Jews and Palestinians kill each other almost daily and where mutual hatreds seem rooted in the stony soil.

The Israeli-Palestinian dispute is just one of the fault lines. Secular Jews face off against religious Jews, Israeli Arabs vs. Israeli Jews.

In such an atmosphere, the formal launch Sunday by the Simon Wiesenthal Center of its plan to build a Museum of Tolerance, drawing on the center’s highly successful experience with its museum of the same name in Los Angeles, seemed almost like an impossible act.

“Promoting tolerance and human dignity is one of mankind’s unfinished challenges,” said Ehud Olmert, Jerusalem’s mayor.

The proposed museum has long generated controversy in Israeli newspapers and magazines. There was behind-the-scenes lobbying by the Yad Vashem, the renowned Holocaust museum here, to discourage the center from going ahead with its plans, which Yad Vashem saw as competition. Some Jerusalem natives bristled at the museum’s provocative design by award-winning American architect Frank O. Gehry.

A number of groups that promote coexistence between Muslims and Jews asked why it was necessary to spend $150 million to build a museum to promote tolerance when there were so many programs under way to work on the issue.

And there was the economic reality: Since the armed violence began here 25 months ago, tourism has all but vanished, leading many people to question whether anyone will come to a museum in Jerusalem.

But none of that daunted the force behind the project, Rabbi Marvin Hier, the founder and dean of the Simon Wiesenthal Center’s Museum of Tolerance in Los Angeles.

The realities and repercussions of the war were “known to everyone involved in this project and we thought maybe we should postpone it,” Hier said. “And then we thought: No, the most important thing for an American Jewish organization is to say we want to have a stake and we’re coming in bad times; we want to do it now.”

Hier said the Wiesenthal Center is committed to raising $150 million in private funds for the building and another $50 million to serve as an endowment – huge amounts by Israeli standards and unimaginable by Palestinian ones. Hier, who is known as an indefatigable fund-raiser, will not say how much has already been raised or pledged, but he did say that his visit to Israel over the past few days had brought in far more money than he had expected.

“We’re well on our way,” he said.

The project also relies on contributions from the city of Jerusalem and the Israeli government, which gave the center the land – a parcel in downtown Jerusalem adjacent to Independence Park. The 3-acre campus on which the museum will be built will also include a conference center, theater, education center and library. The state-of-the-art multimedia exhibits will be interactive. It is slated to be completed by 2007.

In deference to Yad Vashem, the Wiesenthal Museum of Tolerance agreed to avoid dealing with the Holocaust and focus instead both on the history of intolerance prior to the Holocaust and on the post-Holocaust period, particularly terrorism and anti-Semitism, Hier said.

“It would be superfluous in Jerusalem, just a few miles from Yad Vashem, to do that work,” Hier said.

Despite those public assurances, Yad Vashem officials remain skeptical that the new museum will be able to avoid the Holocaust and are clearly irritated that the new center has received backing from the government. In open letters published in local media, some members of the public also questioned whether it is possible to deal with tolerance and intolerance without a discussion of the Holocaust.

“Yad Vashem does not see the need to build an additional Holocaust museum in Jerusalem that will utilize state land and public funds,” said a statement released by the museum.

“The center was granted highly desirable land in the center of the city without a public bid. In addition, the Tolerance Museum, which is run by a private organization, will use public funds to maintain the center’s activities.”