Sakir Ozkan Torunlar, a veteran diplomat who had served as Turkey's consul general in Jerusalem between 2010 and 2014, was named to the post in a presidential decree late Friday, Turkish media reported.
Israel riposted by sending back the Turkish consul in Jerusalem.
Ties between the two soured after Turkish leader Recep Tayyip Erdogan criticised Israel's policy towards Palestinians under the previous governments of its new Prime Minister Benjamin Netanyahu.
But Erdogan sent a congratulatory letter to Netanyahu after his victory in elections held earlier this month.
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