Ruling on building
    a mosque in a graveyard
Question

                A graveyard had been endowed for the
      burial of Muslims, and someone built a mosque with a mihrab in it. Is this permissible?
      Should it be knocked down?
Praise be to Allah.It is not permissible for him to do that, and it should
    be knocked down. (Words of Imaam al-Nawawi).
Taking graves as mosques or places of worship is one of the customs of
    the Jews with whom Allaah is angry. Abu Hurayrah (may Allaah be pleased with him) reported
    that the Messenger of Allaah 
 (peace and blessings of Allaah be upon him) said: May
    Allaah destroy the Jews! They have taken their graves as places of worship. (Agreed
    upon). Ibn Abbaas (may Allaah be pleased with him) said: The
    Messenger of Allaah 
 (peace and blessings of Allaah be upon him) cursed the women who
    visit graves and those who build mosques over them and place lamps on them. Some of
    them claim that this was because at that time they were still close to the time when
    people had worshipped idols, but Ibn Daqeeq al-Eed refuted this argument. This
    indicates that it is haraam to place lamps on graves because this could lead to false
    beliefs.
    In addition to the issue of building mosques over graves, this person's
    actions also involve going against the conditions set by the one who endowed this land.
    Moreover, he is denying the Muslim dead space in which to be buried. Adding any extra
    structure over a grave as the ignorant people among the Muslims do is haraam, as stated by
    the fuqaha and ulama, let alone building mosques over graves. So the
    imaam (Imaam al-Nawawi) ruled that whatever mosques had been built over the graves should
    be torn down.
(Comment in the margin of Fataawa al-Imaam al-Nawawi, p. 65).