JERUSALEM (AP) _ Acknowledging Muslim sensitivities, an Israeli winery said Friday it would no longer produce commemorative bottle labels depicting the Jerusalem skyline, including a mosque that is Islam's third holiest shrine.

The Palestinian Authority had said the labels including the Al Aqsa mosque were an insult to Muslims who may not drink. The Palestinian Information Ministry demanded that the wine not be distributed, especially to the Palestinian areas in the West Bank and Gaza Strip.

Officials at Tishbi Estate Winery said new labels will be out next week, but would not say what they will look like. Bottles already distributed will not be recalled.

Winery spokesman Ynon Harel would not say whether Arab or Palestinian groups pressured the winery to remove the labels, which bore the logo ``Jerusalem 2000.''

``The new labels will not have any symbols that will hurt religious feelings,'' Harel said.

The winery had earlier defended its labels, saying they were millennial souvenirs.