The government's Ministers Committee on Legislation approved yesterday the Criminal Law Proposal (Revision – Illegal Online Games, Lotteries and Gambling) 2007 [Hebrew], a bill intended to illegalize online gambling in Israel as a whole by drying up its source of income. The bill, which was proposed by a parliament member of the ruling party Kadima, should be submitted today to the Knesset (Israeli parliament) for a primary vote.

The bill states that a online gambling will be forbidden, regardless of the physical location of its web servers', if any of the following conditions exist: 1. the website is in the Hebrew language; 2. the website accepts payments in Shekels (Israeli currency); 3. the website includes results of sport events held in Israel between local clubs. The bill empowers the state to order hosting companies and providers of "information transfer services to a website" to block access to a website that a warrant has been issued to in accordance with the bill. Other gambling related activities are also prohibited by the bill, including advertising of gambling websites and the transfer of credit card payments intended for gambling websites.

Apart from the state run lottery, gambling activities are prohibited in Israel and that includes even advertising gambling. Only recently the CEO of an international online gaming company, Victor Chandler, was arrested in Israel for ocnducting online gambling that targeted the Israeli residents through web server in Gibraltar.