Abdullah bin Abbas (may Allah be pleased with them both) says that the Messenger of Allah (peace and blessings be upon him) said: "People of two religions cannot live in one city."
(b) Qabus bin Abi Zabyan relates with his chain: People of two qiblahs cannot be gathered together in the Arabian Peninsula.
The Shaykh says: The Messenger of Allah (peace and blessings be upon him) expelled the Banu al-Nadir and the Jews of Madinah.
Hadith Referenceالسنن الكبرى للبيهقي / كتاب الجزية / 18752