Hundreds of leading rabbis from congregations the world have signed a petition criticizing their counterparts in Israel who issued a religious ruling to forbid Jews from selling or leasing property to Arabs.

More than 750 signatories to the Rabbis against Religious Discrimination petition, funded by the New Israel Fund, deplored the 50 prominent rabbis promoting the new ruling as "causing shock and pain."

"The attempt to root discriminatory policies based on religion or ethnicity in Torah is a painful distortion of our tradition," the petition said.

"Am Yisrael [the people of Israel] knows the sting of discrimination, and we still bear the scars of hatred. When those who represent the official rabbinic leadership of the State of Israel express such positions, we are distressed by this Chillul HaShem, desecration of God’s name," they added in their petition.

The petition further stated that the Jewish communities outside of Israel "struggle to maintain a strong, loving relationship" with Israel. "Many of our congregants love Israel and want nothing more than the safety and security of the Jewish homeland, but for a growing number of Jews in America this relationship to Israel cannot be assumed."

The petition statement added that such proclamations "communicate to our congregants that Israel does not share their values, and they promote feelings of alienation and distancing," as well as provide "justification for anti-Jewish and anti-Israel sentiment across the world."

Meanewhile, Rabbi Chaim Druckman, a moderate religious Zionist leader, is working to achieve a compromise on the controversy surrounding the banning of Jews from selling or leasing property to Arabs, as proclaimed by 50 prominent rabbis last week.

Druckman is proposing an alternative that would distinguish between "loyal Arabs" and "Israel-hating Arabs."

Druckman says a "loyal Arab" must have equal rights, but "Israel-haters" should be ostracized. He opposed the sweeping ruling of the 50 rabbis. Names of potential signatories to Drukman's letter are expected to be released later this week.

Attorney General Yehuda Weinstein's office stated last week that it would look into possible criminal aspects of a religious ruling to forbid renting homes to gentiles signed by a number of leading rabbis.

Yad Vashem Holocaust Memorial also decried the rabbis' letter, deeming it a "severe blow to the values of our lives as Jews and human beings in a democratic state."