Obviously by the early 20th century the majority of the population of Palestine were Arabic-speaking Muslims, but there was still a Jewish minority who had lived in the region for a long time alongside Muslims and Christians (with varying degrees of mutual amicability).
Is there any significant record of how the Jewish population of what would become Mandatory Palestine reacted to the news of the Balfour Declaration? Given that the declaration was made by the British government at the height of its colonial supremacy to a the Zionist Federation, an association of predominantly British Jews, did the Jews in Ottoman Palestine consider it to be simply an exchange of one imperial overlord for another, or did the Jewish minority welcome Britain's stated intentions of establishing a Jewish state in Palestine?
By this point, the Palestinian Jews were the ones pushing for the declaration itself. The declaration was addressed to Lord Walter Rothschild, not to the Zionist Federation (though Rothschild was the head of the British Zionist Federation), but the Zionist Organization that pushed for it was an international group, not a British one. The discussions in passing the Balfour Declaration included assertions by Balfour himself that the majority of Jews in Russia, the US, and "indeed all over the world" were favorable to Zionism. There were some opposed within the British Cabinet, like Edward Montagu, who opposed the Declaration because they believed that it was opposed by British Jews, since it would presumably harm Jews in Britain by eventually leading them to be stripped of their citizenship because their new "national home" would be Palestine. That never came to pass, of course, but it was his fear.
The Jews in Palestine were already mostly Zionist. Those who weren't Zionist immigrants from the 1880-1910 period were likely far less thrilled, because they tended to be older rabbis who feared that Zionism might either: 1) Violate Jewish theological beliefs among the ultra-Orthodox that a Jewish state should only exist when the Messiah arrived, and not before; and 2) Lead to a conflict that could upend their lives. This was a very small group, and representatives of Palestinian Jews were almost entirely Zionists in 1917. Indeed, the Eretz-Yisrael Conference held by the Yishuv (the Jewish community in Palestine) voted in favor of establishing a Jewish state by 55-1. There was no sense that the British intentions were bad for Zionism, or Zionist Jews in the area. Those opposed to Zionism were just too tiny a group to say otherwise. Most Jews believed, and continued to believe after Balfour, that Jews deserved self-determination, and that included the Palestinian Jews who had pushed for things like the Balfour Declaration.