Dein Yassin was just one of the many atrocities that comprise the Nakba, or the catastrophe that befell the Palestinians in the founding of Israel. In fact, residents of other Arab villages fled their homes as the Zionist paramilitary forces spread the word about Deir Yassin. Historian Ilan Pappe writes, "At the time, the Jewish leadership proudly announced a high number of victims so as to make Deir Yassin the epicentre of the catastrophe--a warning to all Palestinians that a similar fate awaited them if they refused to abandon their homes and take flight." In his memoir, Begin wrote that panicked Arabs fled their homes in great number at the "wild tales of 'Irgun butchery.'"
Here is a moving account by Dina Elmuti at Electronic Intifada.
According to Wikipedia:
In 1949, despite protests, the Jerusalem neighborhood of Givat Shaul Bet was built on what had been Deir Yassin's land, now considered part of Har Nof, an Orthodox area. Four Jewish scholars, Martin Buber, Ernst Simon, Werner Senator, and Cecil Roth, wrote to Israel's first prime minister, David Ben-Gurion, asking that Deir Yassin be left uninhabited, or that its settlement be postponed. They wrote that it had become "infamous throughout the Jewish world, the Arab world and the whole world." Settling the land so soon after the killings would amount to an endorsement of them. Ben-Gurion failed to respond, though the correspondents sent him copy after copy. Eventually his secretary replied that he had been too busy to read their letter.
In 1951, construction of the Kfar Shaul Mental Health Center began, using some of the village's houses, now hidden behind the hospital's fence, with entry closely restricted. Har HaMenuchot, a Jewish cemetery, lies to the north. To the south is a valley containing part of the Jerusalem Forest, and on the other side of the valley, a mile and a half away, lie Mount Herzl and the Holocaust memorial museum, Yad Vashem.For more, see Jeremy Hammond's The Rejection of Palestinian Self-Determination and Ilan Pappe's The Ethnic Cleansing of Palestine.