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As I understand it: Zion (meaning "highest point" or "landmark") was a hill in Jerusalem -- specifically the easternmost hill of ancient Jerusalem -- where King David captured the Jebusite city. The term "city of David" refers to the original site upon which the city was built, including the Gihon Spring and the Siloam tunnel, by means of which water was obtained. It was situated on the southern part of the eastern ridge of ancient Jerusalem, west of the Kidron Valley and east of the Tyropoeon Valley, and just south of the Temple Mount. (The term was also used in Scripture to refer to Bethlehem (where David was born), as noted by the angel in announcing Jesus' birth to the shepherds in Luke 2:11.) "Jerusalem" encompassed the entirety of the city of that name.
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