Shin Bet, the counterespionage and internal security service, was believed to have three operational departments and five support departments. The Arab Affairs Department had responsibility for antiterrorist operations, political subversion, and maintenance of an index on Arab terrorists. The Non-Arab Affairs Department, divided into communist and noncommunist sections, concerned itself with all other countries, including penetrating foreign intelligence services and diplomatic missions in Israel and interrogating immigrants from the Soviet Union and Eastern Europe. The Protective Security Department had responsibility for protecting Israeli government buildings and embassies, defense industries, scientific installations, industrial plants, and El Al.

Shin Bet monitored the activities of and personalities in domestic right-wing fringe groups and subversive leftist movements. It was believed to have infiltrated agents into the ranks of the parties of the far left and had uncovered a number of foreign technicians spying for neighboring Arab countries or the Soviet Union. All foreigners, regardless of religion or nationality, were liable to come under surveillance through an extensive network of informants who regularly came into contact with visitors to Israel. Shin Bet's network of agents and informers in the occupied territories destroyed the PLO's effectiveness there after 1967, forcing the PLO to withdraw to bases in Jordan.

Shin Bet's reputation as a highly proficient internal security agency was tarnished severely by two public scandals in the mid-1980s. In April 1984, Israeli troops stormed a bus hijacked by four Palestinians in the Gaza Strip. Although two of the hijackers survived, they were later beaten to death by Shin Bet agents. It appeared that the agents were acting under orders of Avraham Shalom, the head of Shin Bet. Shalom falsified evidence and instructed Shin Bet witnesses to lie to investigators to cover up Shin Bet's role. In the ensuing controversy, the attorney general was removed from his post for refusing to abandon his investigation. The president granted pardons to Shalom, his deputies who had joined in the cover-up, and the agents implicated in the killings.

In 1987 Izat Nafsu, a former IDF army lieutenant and member of the Circassian minority, was released after his 1980 conviction for treason (espionage on behalf of Syria) was overturned by the Supreme Court. The court ruled that Shin Bet had used unethical interrogation methods to obtain Nafsu's confession and that Shin Bet officers had presented false testimony to the military tribunal that had convicted him. A judicial commission set up to report on the methods and practices of Shin Bet found that for the previous seventeen years it had been the accepted norm for Shin Bet interrogators to lie to the courts about their interrogation methods (see Judicial System , this ch.).

Data as of December 1988