Several small Jewish groups had been linked with terrorist attacks against Arabs in the West Bank and East Jerusalem. None of these presented a significant security problem to the IDF as of 1988. The best known of these organizations, the Gush Emunim Underground (sometimes called the Jewish Terror Organization), was formed in 1979 by prominent members of Gush Emunim, a group of religious zealots who had used squatter tactics to carry on a campaign to settle the West Bank after the October 1973 War. The underground perceived the 1978 Camp David Accords and the 1979 Treaty of Peace Between Egypt and Israel as betraying the Begin government's policy of retaining the territories conquered by Israel.

The principal terrorist actions of the Gush Emunim Underground were carried out between 1980 and 1984. In 1980 car bombings of five West Bank Arab mayors resulted in crippling two of the mayors. In 1983, the Hebron Islamic College was the target of a machinegun and grenade attack that killed three Arab students and wounded thirty-three others. In 1984 an attempt was made to place explosive charges on five Arab buses in East Jerusalem. This plot was foiled by agents of Israel's internal security force, Shin Bet, leading to arrest and prison sentences for eighteen members of the underground. The security services also uncovered a well-developed plan to blow up the Dome of the Rock, one of Islam's most sacred shrines, on Jerusalem's Temple Mount.

Another anti-Arab terrorist group, Terror Against Terror (known as TNT) was established by Kach, the right-wing extremist political movement of Rabbi Meir Kahane. TNT was responsible for numerous beatings and bombings and several murders of Arabs, beginning in 1975. Defending Shield (Egrof Magen), a Jewish vigilante group of West Bank settlers formed in 1983, was responsible for a number of attacks and vandalization of Arab property on the West Bank. During the intifadah, beginning in late 1987, there were many reports of Jewish vigilantism, including shootings, punitive raids on refugee camps, and assaults on Arab motorists in retaliation for rock-throwing attacks by Arab youths. Most of these appeared to be spontaneous actions by settlers of individual communities.

Data as of December 1988