Guatemala and Israel have long had close ties, especially in security matters and Israeli arms sales to Guatemala.
Israel's ambassador to Guatemala, Matty Cohen, said on Army Radio that no date had been set for the embassy move, "but it will happen after" the United States relocates its own embassy to Jerusalem.
Guatemalan President Jimmy Morales announced in a Facebook post on Sunday that the Latin American country would be moving its embassy in Israel to Jerusalem.
Guatemala's leader made the announcement on Christmas Eve, three days after two-thirds of UN member states rejected Trump's decision to have the United States recognize Jerusalem as Israel's capital.
Last Thursday, the UN General Assembly overwhelmingly adopted a resolution - by a vote of 128 to 9 - calling on Trump to reverse the decision.
In a post on his official Facebook account Sunday, Morales said that after talks with Israeli Prime Minister Benjamin Netanyahu, he chose to instruct Guatemala's foreign ministry to move the embassy.
Guatemala and neighbouring Honduras were two of only a handful of countries to join Israel and the United States, which has pledged to move its embassy to Jerusalem, in voting against the U.N. resolution.
Prime Minister Benjamin Netanyahu (R) meets with Guatemalan President Jimmy Morales (L) in Jerusalem on November 29, 2016.
Trump's announcement on December 6 sparked anger in the Palestinian territories and across the Muslim world.
No country now has its embassy in Jerusalem, instead keeping them in the Israeli commercial capital Tel Aviv.
Hotovely said US President Donald Trump's statement would "trigger a wave" of such moves. Nineteen years later, in June 1967, Israel captured the eastern side, expanded the city's boundaries and annexed it - an act that was never recognised internationally.
The resolution passed at the United Nations declared the USA action on Jerusalem "null and void". The 128-9 vote indicated that few countries favor the US decision. Thirty-five nations abstained and 21 stayed away from the vote.
In all, 128 nations voted to maintain the worldwide consensus that Jerusalem's status can only be decided through peace negotiations between Israelis and Palestinians.