Since the third wave of democratization of developing countries in the 1970s, the Western leading scholars in the field of the Middle Eastern studies have argued that the political underdevelopment in the Arab Muslim countries of Middle East originates from the religion of Islam without concrete empirical evidences. The aim of this paper is to explore the inter-relationship between political development and Islam in the Muslim sub-sector in Israel, defining the political development as an institutionalization of politics which pursues to advance the universal values such as freedom, equality and human rights, and the process of strengthening the capability of political system. This study focuses upon the question of whether the Islam as a religion and Arab Islamic movements in Israel have contributed or hindered to its political development by explicating. It examines interactions among the Israeli government`s policy toward the Arab Muslim sector; its political system, consisted of mainly political parties of Israeli Arab sector; the domestic and international environment of the Israeli Arab political system. It also attempts to explore the changes in the values and attitudes of the constituents of the Israeli Arab society with the macro approach and micro politico-cultural approach. The Islamic movement of Israeli Arab sub-sector has been developed and increasingly become influential political actors in both of the level of local governments and the level of Israeli national politics with the tacit support of major Israeli national political parties, basing upon the social welfare institutions such as medical, educational and cultural organizations. After the Islamic movements had risen and become important actors, however, they have struggled for the strengthening of the identity of Palestinian Muslim and the political and economical equality of Arab Muslim Palestinians with the Israeli Jewish sector within the Israeli legal bounds. Their struggle and Since the third wave of democratization of developing countries in the 1970s, the Western leading scholars in the field of the Middle Eastern studies have argued that the political underdevelopment in the Arab Muslim countries of Middle East originates from the religion of Islam without concrete empirical evidences. The aim of this paper is to explore the inter-relationship between political development and Islam in the Muslim sub-sector in Israel, defining the political development as an institutionalization of politics which pursues to advance the universal values such as freedom, equality and human rights, and the process of strengthening the capability of political system. This study focuses upon the question of whether the Islam as a religion and Arab Islamic movements in Israel have contributed or hindered to its political development by explicating. It examines interactions among the Israeli government`s policy toward the Arab Muslim sector; its political system, consisted of mainly political parties of Israeli Arab sector; the domestic and international environment of the Israeli Arab political system. It also attempts to explore the changes in the values and attitudes of the constituents of the Israeli Arab society with the macro approach and micro politico-cultural approach. The Islamic movement of Israeli Arab sub-sector has been developed and increasingly become influential political actors in both of the level of local governments and the level of Israeli national politics with the tacit support of major Israeli national political parties, basing upon the social welfare institutions such as medical, educational and cultural organizations. After the Islamic movements had risen and become important actors, however, they have struggled for the strengthening of the identity of Palestinian Muslim and the political and economical equality of Arab Muslim Palestinians with the Israeli Jewish sector within the Israeli legal bounds. Their struggle and activities of the