The United Arab Emirates (UAE) is well known for its economic power and moderate Islam, and for its increasing involvement in regional developments throughout the Middle East, including the Israeli-Palestinian conflict. The UAE adheres to the official policy of the Arab League towards the Israeli-Palestinian conflict, and accordingly calls for the implementation of a two-state solution in the spirit of the Arab Peace Initiative. In light of this, the current political, strategic, security and economic cooperation between Israel and the UAE are ad-hoc, often taking place under the radar or under international sponsorship. Nevertheless, Israel and the UAE share multiple interests, including the opposition to Iran, the battle against terror, the possibility of opening trade routes between them and from the Mediterranean to the Gulf, and cooperation on civil issues such as tourism, medicine, research and environment. In order for the two countries to fulfill this potential, Israel must make progress towards reaching peace with the Palestinians.