The Israeli-Palestinian peace process in the early 1990s offered a glimpse of hope also to the relations between Israel and its Arab citizens. The peace process, once accomplished, could change the security framework within which the minority was perceived and provide an opportunity of equality for the minority. Thus, a liberal framework of citizenship could end all discriminations and inequalities and allow the integration of Arab citizens. The developments since 1993, and especially since 2000, demonstrate not only the fragility of the peace process but also the limited possibility of a liberal citizenship in Israel. As the developments indicate, the rejection of the Jewish majority of a liberal state “of all its citizens” is matched by new voices of Arab-Palestinian citizens who demand recognition as a national minority.