Trump's decision and his plan to move the US embassy to Jerusalem sparked violence in Jerusalem, with a fifth day of protests in the Middle East.
"Both Russia and Turkey believe that the decision... does not help regulating the situation in the Middle East but instead destabilises the already complicated atmosphere," Putin said during a press conference in Ankara.
"It can derail the Israel-Palestine peace process," he warned after his meeting with Erdogan following lightning visits to Syria and Egypt earlier on Monday.
Erdogan said that he and Putin had taken a similar approach on the issue as he accused Israel of continuing to "add fuel to the flames".
"Israel is using this as an opportunity to further increase the pressure and violence against Palestinians," he added.
Putin earlier in Cairo stressed the importance of "the immediate resumption of Palestinian-Israeli talks over all disputed issues, including the status of Jerusalem"