This paper examines the prejudice and misunderstanding of Islam and Muslim in Western films, especially Hollywood movies. Since seeing is believing, the movie producers contribute to the formation of distorted images of Islam and Muslim. In the 20th century Western movies have manufactured Muslim as villains, sheikhs, maidens, and terrorists. Though a few films show Islam and Muslims positively, most Western films misrepresent Islam and Muslims as a violent religion and bad Arabs. The Dutch short films produced by Theo van Gogh and Geert Vilders criticize Islam from atheist and political position. Gogh`s Submission (2004) debunks sufferings of Muslim women under the veil and Vilders` Fitna(2008) criticizes the process of Islamisation in Europe, defending the freedom of speech. There are three approaches to Islam and Muslim in Western films: religious parochialism, atheistic naturalism and political reductionism. In order to overcome these trends, I suggest a phenomenological approach to Islam and Muslim based on intratextuality, empathy, and suspension of judgment. In conclusion, we need a critical interpretation of distorted images in Western films and self-identity in the films of Islamic countries. Rather than limiting our research area into religions in film, broader understanding is needed for the new generation who regards film as a religion, not as a tool.