ACLJ attorney Brett Joshpe said the group would file a petition alleging that the landmarks panel "acted arbitrarily and abused its discretion."

The proposed mosque has emerged as a national political issue, with prominent Republicans from former Alaska Gov. Sarah Palin to former House Speaker Newt Gingrich lining up against it. The Anti-Defamation League, the nation's most prominent Jewish civil rights group, known for advocating religious freedom, shocked many groups when it spoke out against the mosque last week.

The League said building the Islamic center "in the shadow of the World Trade Center will cause some victims more pain — unnecessarily — and that is not right."

Bloomberg said Tuesday that denying religious freedom to Muslims would play into terrorists' hands. He said firefighters and other first responders who died in the Sept. 11 attacks had done so to protect the U.S. Constitution.

"In rushing into those burning buildings, not one asked, 'What god do you pray to? What beliefs do you hold?'" Bloomberg said of the first responders. "We do not honor their lives by denying the very constitutional rights they died protecting."

Former Rep. Rick Lazio, a Republican running for governor of New York, attended the commission meeting with a handful of opponents to the mosque, which is being developed by a group called the Cordoba Initiative.

"This is not about religion," Lazio said. "It's about this particular mosque called the Cordoba Mosque, it's about it being at ground zero, it's about it being spearheaded by an imam who has associated himself with radical Islamic causes and has made comments that should chill every single American, frankly."

Lazio said the group's imam, Feisal Abdul Rauf, had refused to call the Palestinian group Hamas a terrorist organization. Rauf also said in a "60 Minutes" interview televised shortly after Sept. 11 that "United States policies were an accessory to the crime that happened."

The Cordoba Initiative says on its website that its goal is to foster a better relationship between the Muslim world and the West, "steering the world back to the course of mutual recognition and respect and away from heightened tensions."

"We believe it will be a place where the counter-momentum against extremism will begin," the imam's wife, Daisy Khan, told The Associated Press Friday. "We are committed to peace."

Khan told The Wall Street Journal that the center's board will include members of other religions and will explore including an interfaith chapel at the center.

The commission's decision not to designate the existing building as a landmark means that the developers can tear it down and start from scratch. If the building had been declared a landmark, they could have created a smaller mosque and community center there.

A partner in the project, SoHo Properties, bought the property for nearly $5 million. Early plans call for a 13-story, $100 million Islamic center.

Cordoba wants to transform the building into a glass tower with a swimming pool, basketball court, auditorium and culinary school besides the mosque. The center, called Park51, also would have a library, art studios and meditation rooms.

Landmarks Commissioner Stephen Byrns said the building's proximity to ground zero and the fact it was struck by airplane debris during the Sept. 11 attacks don't qualify it as a landmark.

"The debris field around ground zero was widespread, and one cannot designate hundreds of buildings on that criterion alone," Byrns said.

SoHo Properties CEO Sharif El-Gamal said he was "deeply grateful to the landmarks commission and to its staff." He did not respond to a question about the timing of demolition and construction.

While landmarks commission members went over the existing building's architectural features such as cornices and colonnades, some in the audience of about 60 at Pace University in lower Manhattan held signs telegraphing their opposition.

Linda Rivera's sign read, "Don't glorify murders of 3,000. No 9/11 victory mosque." She cried after the board's vote.

"I lost 3,000 American brothers and sisters, including courageous policemen and firemen, and this is a betrayal," she said.

But Zead Ramadan, president of the board of the New York chapter of the Council on American-Islamic Relations, said Islam is "a religion of peace and justice."

"The people here are trying to connect this vile attack on our nation to the religion Islam," he said, "though that exact act stands against everything that Islam stands for."