"The US decision is an all-out war on the Arab and Islamic nations as it emphasizes the US implication in backing the Zionist occupation…," said a statement by the council, Saba news agency reported.
It added "the US decision will have unlimited bad consequences on the region."
The Gaza Health Ministry put the Palestinian death toll in Gaza border protests on Monday at nearly 60, including 57 people killed by Israeli army fire and a baby who died from tear gas inhalation.
The ministry said six of those killed by gunshots were minors.
It said more than 2,700 people were injured Monday, including 1,360 by live fire. Of the wounded, 130 are in serious or critical condition.
On Monday, tens of thousands of Palestinians rallied near Israel's border fence to protest a blockade of their territory and the move of the US Embassy from Tel Aviv to Jerusalem (al-Quds) that day.