Issues relating to the complex have been at the centre of fresh violence between `Israelis` and Palestinians.
Mr Kerry was speaking after talks in Jordan, the formal custodian of what is known to Jews as the Temple Mount and as Haram al-Sharif to Muslims.
He said `Israel` had renewed a pledge to maintain existing rules there.
In the latest upsurge of violence, at least eight `Israelis` have been killed and dozens wounded in knife or gun attacks by Palestinians, following rumours that `Israel` was planning to change the rules - something `Israel` denies.
About 50 Palestinians, including several of the attackers, have been killed in recent weeks.
Mr Kerry, who is on a tour of the region, met Palestinian leader Mahmoud Abbas and King Abdullah of Jordan in Amman on Saturday.
"All the violence and the incitement to violence must stop. Leaders must lead,'' Mr Kerry told reporters.
The steps he announced include round-the-clock video monitoring and `Israel's` agreement to reaffirm Jordan's historic role as custodian of the religious complex.
"There are serious additional issues, security and otherwise, between `Israelis` and Palestinians that must be addressed but we've agreed that this is a first step to creating some space in order to allow us to resume those steps and that dialogue," he said.
Mr Kerry met `Israeli` Prime Minister Benjamin Netanyahu on Thursday, and said the talks had raised ideas that were worth exploring.
Later on Saturday, Mr Kerry will travel to Saudi Arabia for talks with regional leaders.
In the latest violence, `Israeli` police said they shot dead a Palestinian attacker in the northern West Bank early on Saturday.
"A terrorist, who arrived armed with a knife, tried to stab a security guard at the site. In response, the terrorist was shot by the security force," it said, according to AFP news agency.
What is happening between `Israelis` and Palestinians?
There has been a spate of stabbings of `Israelis` and some shootings - several of them fatal - by Palestinians since early October, and one apparent revenge stabbing by an `Israeli`. The attackers have struck in Jerusalem and across `Israel`, and in the occupied West Bank. `Israel` has tightened security and its security forces have clashed with rioting Palestinians, leading to deaths on the Palestinian side. The violence has also spread to the border with Gaza.
What's behind the latest unrest?
After a period of relative quiet, violence between the two communities has spiralled since clashes erupted at a flashpoint Jerusalem holy site in mid-September. It was fuelled by rumours among Palestinians that `Israel` was attempting to alter a long-standing religious arrangement governing the site. `Israel` repeatedly dismissed the rumours as incitement. Soon afterwards, two `Israelis` were shot dead by Palestinians in the West Bank and the stabbing attacks began. Both `Israel` and the Palestinian authorities have accused one another of doing nothing to protect each other's communities.
Is this a new Palestinian intifada, or uprising?
There have been two organised uprisings by Palestinians against `Israeli` occupation, in the 1980s and early 2000s. With peace talks moribund, some observers have questioned whether we are now seeing a third. The stabbing attacks seem to be opportunistic and although they have been praised by militant groups, Palestinian leader Mahmoud Abbas has said Palestinians are not interested in a further escalation.