Even centuries before the fall of Jerusalem to the Roman Empire (A.D. 70), 3.5 million Jews lived in diaspora while only half a million resided in Palestine.
When Seleucids conquered Jerusalem, the Seleucid kings allowed Jews to be governed under their own laws (i.e. the laws of the Torah). However, in the years preceding the Maccabean Revolt, some Jerusalemites had petitioned to form a Greek city (polis), Antiocheia, which existed inside and alongside the Jewish city of Jerusalem. After the events of 168 BCE (probably rebellion or unrest—we have no direct sources on this), the Jewish community lost its local rights, including control of the Temple