The history of Israel encompasses the history of the modern State of Israel, as well as that of the Jews in the Land of Israel. The area of modern Israel is small, about the size of Wales or half the size of Costa Rica, and is located roughly on the site of the ancient kingdoms of Israel and Judah except that these ancient kingdoms also included what is now the West Bank. It is the birthplace of the Hebrew language spoken in Israel, and of the Abrahamic religions. It contains sites believed to be sacred to Judaism, Christianity, Islam, Druze and Bahá'í Faith.
Although coming under the sway of various empires and home to a variety of ethnicities, the Land of Israel was predominantly Jewish until the 3rd century. The area became increasingly Christian after the 3rd century and then largely Muslim from the 7th century conquest until the middle of the 20th century. It was a focal point of conflict between Christianity and Islam between 1096 and 1291, and from the end of the Crusades until the British conquest in 1917 was part of the Syrian province of first the Mamluk Sultanate of Egypt and then (from 1517) the Ottoman Empire.
In the late-19th century, persecution of Jews, particularly in Europe, led to the creation of the Zionist movement. Following the British conquest of Syria, the Balfour Declaration in World War I and the formation of the Mandate of Palestine, Aliyah (Jewish immigration to the Land of Israel) increased and gave rise to Arab–Jewish tensions, and a collision of the Arab and Jewish nationalist movements. Israeli independence in 1948 was marked by massive migration of Jews from both Europe and the Muslim countries to Israel, and of Arabs from Israel leading to the extensive Arab–Israeli conflict. About 42% of the world's Jews live in Israel today.
Since about 1970, the United States has become the principal ally of Israel. In 1979 an uneasy Egypt–Israel Peace Treaty was signed, based on the Camp David Accords. In 1993 Israel signed Oslo I Accord with the Palestine Liberation Organization and in 1994 Israel–Jordan Treaty of Peace was signed. Despite efforts to establish peace between Israel and Palestinians, many of whom live in Israel or in Israeli-occupied territories, the conflict continues to play a major role in Israeli and international political, social and economic life.
The economy of Israel was initially primarily socialist and the country dominated by social democratic parties until the 1970s. Since then the Israeli economy has gradually moved to capitalism and a free market economy, partially retaining the social welfare system.