The incident was captured on video by the Australian Jewish Association -- showing JS roast the hell out of a dude in the crowd at his Sydney show Sunday night ... when the guy interrupted Jerry to shout, "From the river to the sea, Palestine will be free."

The crowd was definitely on Jerry's side -- demanding the protester leave ... chanting "Jerry, Jerry" in solidarity with the comedian .... who spotlighted the heckler, sarcastically joking, "We have a genius, ladies and gentlemen. He solved the Middle East crisis!"

Jerry went on to mock the man's approach to the situation ... saying, "It's the Jewish comedian, that's who we have to get, they're the ones doing everything."

He added, "We're all on your side now, because you've made your point so well, and in the right venue. You've come to the right place for a political conversation."

There was a lot more Jerry had to say about this ... watch the video and you'll see yourself.

In the end, security came over to escort the guy out ... and you can tell Jerry was relishing in it. Like we said, he was definitely in control -- and didn't let this rattle him one bit.

Of course, this isn't the first time Jerry's clashed with a pro-Palestine protester -- he was heckled onstage last month, too, during another comedy gig. And he was also quietly protested during a college graduation last month ... this amid stances he's publicly taken.