Jerusalem police said Sunday that the two Arab gunmen who opened fire at an Israeli security post on the southeastern edge of the city on Saturday night were residents of east Jerusalem. The two assailants, who were shot dead by two wounded Israeli security personnel, were identified Sunday as Madchat Muhammad Shakirat and Mahmoud Naji Halaseh, both 23, of the east Jerusalem neighborhood of Jebl Mukaber. Police had previously identified the gunmen as Palestinians from the West Bank. The two attackers, who were affiliated with an offshoot of Palestinian Authority Chairman Mahmoud Abbas's mainstream Fatah Movement, carried blue Israeli ID cards, Jerusalem police Shmuel Ben-Ruby said. "The fact that the terrorists had blue Israeli ID cards is especially serious," Internal Security Minister Avi Dichter said Sunday during a hospital visit to the two wounded security personnel. "We must work to reduce this phenomenon, since to my sorrow this is not an isolated case." The revelation that the gunmen in the unusual east Jerusalem attack were Jerusalem Arabs raised anew questions relating to the loyalty of the city's Arab residents to Israel, and their connections with various Palestinian terror organizations. The vast majority of Jerusalem's 240,000 Arab residents have remained on the sidelines of violence over the last six years, preferring to focus on their coveted city jobs and the economic benefits living under Israeli sovereignty offers them, although an increasing number have been enlisted by Palestinian terror groups to carry out or assist in attacks. Most of Jerusalem's Arabs hold permanent residency cards and Jordanian passports, having turned down full citizenship due to their opposition to Israeli rule over the city. As city residents, Jerusalem Arabs pay city taxes, and receive an array of social services including health care, unemployment pay and social security benefits from Israel. At the same time, the freedom of movement afforded Arabs living in Jerusalem - who make up one in three city residents - has proved to be of invaluable assistance to Palestinian terror groups, who have frequently enlisted Jerusalem Arabs to serve as accomplices in their terror attacks in the city, especially after the construction of the security barrier made it harder for Palestinians to slip into the city. Meanwhile, police also said Sunday that they were checking whether a third Arab man killed in the shootout was also involved in the attack, or was an innocent bystander as they previously assumed. The man was identified Sunday as Muhammad Awasit, 19, also of Jebl Mukaber. The bodies of the gunmen and the third victim have been transferred to the L. Greenberg Institute of Forensic Medicine at Abu Kabir. The two gunmen opened fire at the Israeli security patrol shortly after 8:00 p.m. on Saturday near a section of the security barrier on the edge of Jerusalem, wounding two security officials, one seriously. The attackers were shot and killed by the wounded security personnel. The shooting took place during a routine patrol in the Arab village of Sheikh Said, adjacent to the Jewish neighborhood of Armon Hanatziv on the southeastern rim of the city. The two assailants made their way on foot to the area under cover of darkness, ambushed the patrol, and then tried to flee, Jerusalem police spokesman Shmuel Ben-Ruby said. On Sunday it emerged that the two assailants did not cross into Jerusalem from the West Bank, or slip through the partially completed security barrier in the area, but simply walked up to the security patrol from the nearby Arab village, which falls within city limits and is on the Israeli side of the security barrier in the area. One of the Israeli security men, 26, was shot in the chest and was listed in serious condition, while the other was hit in the legs and was in moderate condition. The condition of both improved overnight, and they were both listed in stable condition at Jerusalem's Hadassah-University Hospital at Ein Kerem. "We were at the security post and I was talking to the security guard when suddenly two people approached on foot," recounted border policeman Isam Abu-Rish from his hospital bed. "We did not suspect them at all, but suddenly one of them shot me in the back at point-blank range. I got out of the way and I saw that he was trying to shoot me again but that his gun jammed, and I immediately shot him and the second terrorist who shot the other guard and was running towards me," Abu-Rish said. "I told myself that this was like in a movie. They even had the chance to shout Allah Akbar," he added. The routine barrier patrol in the area, which has become a target for Palestinian terror groups, includes border policemen and civilian guards. "We are not surprised that the passages [in the security barrier] have become targets, and this issue was and will be dealt with," Jerusalem police chief Ilan Franco said. The security barrier going up around Jerusalem is meant to thwart Palestinian suicide bombers from entering the city. The 84-km. barrier going up on the outskirts of Jerusalem, which is about two-thirds complete, will place 55,000 Arab residents in the city living in four outlying Jerusalem neighborhoods on the Palestinian side of the barrier, with the remaining 185,000 Arab residents of the city on the Israeli side, officials said. Construction on the nationwide project began in 2002 but has been repeatedly slowed by scores of legal challenges, some of which are still pending, as well as by political uncertainties over the barrier's exact routing. Israel has refused to erect the Jerusalem-area barrier within the capital which would have effectively divided east and west Jerusalem, and abetted the Palestinians who want to set up their capital in the eastern part of the city. Arab residents of the borderline neighborhood where the Saturday night shooting took place have even petitioned the High Court of Justice to be on the Israeli side of the barrier. Over the last two years, there have been no suicide bombings in the city, and shooting attacks have become very rare. Israel has completed more than two-thirds of the 680-km. barrier going up nationwide since construction began five years ago following an unprecedented wave of Palestinian suicide bombings that killed hundreds of Israeli civilians.