The CIA’s Secret Operations in Israel-Palestine: From Psychological Warfare to Arms Deals

Throughout the Cold War and into the present day, the Central Intelligence Agency (CIA) has played a pivotal but often hidden role in shaping the geopolitical landscape of the Israel-Palestine conflict. Operating in the shadows, the CIA has engaged in covert operations, psychological warfare, arms deals, intelligence manipulation, and diplomatic backchannels—all aimed at maintaining U.S. strategic dominance in the Middle East. While Washington publicly positioned itself as a peace broker, behind the scenes, the agency was deeply involved in efforts to control the balance of power, destabilize hostile elements, and prevent Soviet influence from taking hold.

The CIA’s presence in the region was solidified in the aftermath of World War II and the early days of the Cold War, when the Middle East became a key battleground between the United States and the Soviet Union. The agency's earliest missions were focused on monitoring Soviet influence in Arab states, managing Israeli intelligence partnerships, and cultivating contacts within Palestinian factions to gather information and influence political outcomes. Over time, the agency’s role expanded, involving a mix of covert sabotage, regime manipulation, arms shipments, and deep collaboration with both Israeli and Arab intelligence services.

The Early Years: CIA’s Entry into the Israel-Palestine Arena

Following the 1948 Arab-Israeli War, the CIA quickly recognized the strategic importance of Israel as a Western-aligned stronghold in the Middle East. However, U.S. policy also required maintaining relationships with key Arab states to counter Soviet penetration in the region. This delicate balancing act led the CIA to engage in a series of covert operations aimed at managing the Arab-Israeli conflict without fully committing to either side militarily.

One of the agency’s earliest missions involved monitoring Soviet involvement in arming and training Palestinian factions and Arab nationalist forces. By the early 1950s, CIA operatives were stationed in Israel, Jordan, Lebanon, and Egypt, gathering intelligence on both Israeli and Palestinian leadership. At the same time, the agency worked to limit British influence in the region, as remnants of the British intelligence presence clashed with American ambitions in the newly independent Middle East.

Covert Collaboration with Israeli Intelligence (1950s-1960s)

As the CIA deepened its ties with Mossad, Israel’s intelligence agency, a secret intelligence-sharing relationship emerged. The agency viewed Israel as a critical intelligence outpost in the Cold War struggle against the USSR. This partnership allowed the CIA to gain access to intelligence on Soviet arms movements in Arab states while assisting Israel in countering Egyptian and Syrian influence.

At the same time, the CIA sought to monitor and infiltrate Palestinian factions, particularly those that had ties to Soviet-backed regimes. Early operations included attempts to recruit informants within Fatah and the Palestine Liberation Organization (PLO) while also conducting psychological warfare operations aimed at sowing divisions between Palestinian factions and their Arab allies.

By the late 1960s, CIA assets had penetrated various Palestinian militant groups, providing intelligence that was passed on to both the U.S. State Department and Israeli security forces. However, as Palestinian groups became more radicalized, the agency also began using covert sabotage operations, misinformation campaigns, and financial disruption tactics to undermine PLO leadership.

Arming Both Sides: The CIA’s Role in Weapons Transfers

Despite maintaining a public stance of neutrality, the CIA facilitated arms deals that benefited both Israeli and Arab factions at different points in the conflict. These operations were often designed to maintain balance in the region, ensuring that no single faction became dominant enough to threaten broader U.S. strategic interests.

One of the most significant covert operations came in the 1970s, when the agency assisted in securing arms shipments for Jordan’s King Hussein during Black September (1970)—the Jordanian military’s crackdown on the PLO. The CIA’s involvement helped ensure that the Palestinian factions, particularly those aligned with Soviet interests, did not overthrow the Hashemite monarchy, which was seen as a key pro-Western ally.

At the same time, the CIA worked closely with Mossad to disrupt Soviet arms shipments to Palestinian factions. Intelligence gathered from intercepted shipments in the Mediterranean allowed the agency to track KGB efforts to arm militant groups, and in some cases, directly sabotage weapons deliveries before they reached Palestinian fighters.

Psychological Warfare and Propaganda Operations

Beyond direct military and intelligence interventions, the CIA played a significant role in shaping public perception of the Israel-Palestine conflict through psychological warfare operations. In the 1970s and 1980s, the agency worked closely with Western media outlets, academic institutions, and Arab political dissidents to promote narratives that framed the conflict in ways favorable to U.S. interests.

One of the most effective tactics was the use of disinformation campaigns to discredit Palestinian leaders. Documents later declassified revealed CIA-sponsored efforts to spread rumors of corruption, Soviet control, and internal dissent within the PLO to weaken its credibility among Arab states. At the same time, the agency promoted Zionist-Christian Evangelical movements in the U.S., reinforcing the idea that supporting Israel was a religious and strategic imperative for American policymakers.

Meanwhile, the CIA also supported moderate Palestinian voices, encouraging the emergence of factions that could serve as alternatives to radicalized elements. Some of these efforts later played a role in facilitating the Oslo Accords of the 1990s, as the agency acted as a silent mediator between Palestinian and Israeli negotiators.

The 1980s: Iran-Contra, Lebanon, and CIA’s Shifting Role

During the Lebanon Civil War (1975-1990), the CIA found itself entangled in one of its most complex operations in the region. The agency played a role in the Iran-Contra Affair, a clandestine operation where the U.S. secretly sold arms to Iran while using the proceeds to fund Contra rebels in Nicaragua. Unbeknownst to many, some of these weapons ended up in the hands of Lebanese militias and Palestinian factions, further complicating the conflict dynamics.

The 1980s also saw the rise of Hamas, backed initially by Israeli intelligence as a counterweight to the PLO. The CIA monitored Hamas’s growth but underestimated its long-term impact. The agency’s failure to predict the full consequences of this proxy strategy would later haunt both the U.S. and Israel, as Hamas became a dominant force in Palestinian politics.

Post-Cold War Adjustments and Modern CIA Operations

After the fall of the Soviet Union in 1991, the CIA’s role in Israel-Palestine evolved. Without the Cold War framework, the agency shifted its focus toward counterterrorism, counterintelligence, and regional stability. Post-9/11, the CIA worked extensively with Israeli and Arab intelligence services to combat militant Islamist factions in both Palestine and neighboring states.

The agency also played a key role in monitoring and managing Iran’s influence in Palestinian affairs, particularly Tehran’s support for Hamas and Islamic Jihad. Intelligence-sharing between the CIA, Mossad, and Gulf Arab states intensified, leading to joint operations to weaken Iranian-backed factions.

More recently, the CIA has been involved in cyber warfare and intelligence surveillance, tracking financial networks that fund Palestinian militant groups and monitoring the rise of new geopolitical players, such as China’s growing role in the region.

The Lasting Legacy of CIA Operations in Israel-Palestine

The CIA’s decades-long involvement in the Israel-Palestine conflict has left a lasting imprint. The agency’s covert operations, psychological warfare, arms deals, and intelligence manipulation have shaped the conflict in ways that often remain hidden from public view. While Washington has consistently positioned itself as a mediator, the reality is far more complex—the CIA has not just observed history but actively shaped it from behind the scenes.

The legacy of these operations continues to influence contemporary dynamics. The alliances forged, rivalries deepened, and intelligence strategies developed during the Cold War still define how external powers engage with Israel and Palestine today. The CIA’s role in this geopolitical struggle remains a testament to how intelligence warfare can shape the course of conflicts for generations.