[Edit]

Jerusalem will be high on any list of favourite destinations and with good reason: in the old city there is a church or convent on every corner, there are beautiful mosques and many other holy places.
Tel Aviv is the place to party. It has good beaches , top cuisine restaurants and excellent nightlife, probably the best to be found within a circle of a few thousand kilometers.
The north of Israel is worth to explore: the Sea of Galilee,
Nazareth , the Golan Heights and the towns of Tiberias, Acre (aka Akko), and Haifa are the most important stops on your itinerary to the North.

The south offers the enormous Negev desert and the Dead Sea. In the southernmost point of Israel, the Red Sea beach resort of Eilat is a touristic hot spot. Located at the very bottom tip of Israel, this is a popular fun-in-the-sun vacation spot.
Within the state of Israel you will find the Palestinian Authority which has some form of autonomy. Cities like Nablus , Jenin , Hebron (in arabic called al Khalil), Bethlehem and Ramallah are dealt with in the guide about the Palestinian Authority.
Israel enjoys excellent climate conditions. Temperatures all year round are reasonable. The main winter months are between December and February. Between May and october there is very little rainfall. The best time to visit Israel is in the spring (march-june). In this time of the year, temperatures rise and it doesn't rain too much. In addition, in the springtime the all parts of Israel is covered with green vegitation and flowers.
Places to go:
Jerusalem
Jerusalem is the three times holy capital of the twice promised land. In the old city you will see priests, nuns, mollahs and rabbi's all over the place. Churches of every possible denomination dot the town, the gold domed mosque of the Haram-al-Sharif is seen from afar, the wailing wall is always busy. But the old city of Jerusalem is not just a holy place. It is also a very busy market place with more tourist shops than anywhere else, the arab part of town has bustling markets (especially near Damascus Gate) where anything is for sale.
Unfortunately, Jerusalem is also a city of tension. Different groups do not always live together in peace and when you walk the streets at night all of a sudden people start running in one direction, because something is going on. Try to avoid being caught up in such clashes.

Tel Aviv is the most modern and westernized place in Israel. Jerusalem is the official capital (although not internationally recognized as such) and the religiuos capital, Tel Aviv is the party capital (almost officialy recognized). When you walk the streets at night you can hardly imagine you are in the holy land. Sidewalk cafes give the city a decidedly European flavor and shopping at the enclosed Dizengoff Center is pleasant.
Tel Aviv is also the business center of Israel, and has the largest percentage of young people.
Jaffa is the old arabic part of Tel Aviv. It is much older (Tel Aviv was founded in 1909) and is now some sort of the Quartier Latin of the city. Although it has many small and trendy boutiques it still retains some of its flavour as an arabic city.
The best reason to come to Tel Aviv is to have a good time, the nightlife is great, there are good restaurants, there are so many shops, the beaches aren't bad and there is always something going on.
A good place for trendy shopping would be Sheinkin street; Kikar Hamedina is known for its upscale (and expencive) shops; and Azriely center, Ramat Aviv mall and Dizengoff center would answer all your shopping mall needs. Alternatively, you can check out Shuk HaCarmel, a large street market held daily on Carmel St.
Bazel street has the best coffee places; Allenby and Lilienblum streets is where you'll find all night partys and bars; and you shouldn't miss the beach- for sunbathing and babe watching.

Haifa is the third biggest city of Israel and the economic powerhouse of the country. As the people in Haifa say: Jerusalem is for praying, Tel Aviv for partying, Haifa for working and praying. The first impression of the city is not always a positive one; this city IS about working. It's not designed for tourists. But if you look a bit closer you will find a fascinating place a multicultural melting pot, where Arab and East European influence blend together. Traditional, contemporary, sophisticated, relaxed, Haifa combines it all. And with many theaters, museums, cinemas, hotels and air-conditioned shopping malls there is plenty to do. And there are some pretty good beaches close to the city.
One of the main attractions is the Carmel mountain, which offers a rich variety of breathtaking panoramas. On the mountain you find the Baha'i Holy Shrines, the Gan Ha'em park & a zoo. The Baha'i Shrines are continuously visited by Baha'i pilgrims. They include the Shrine of the Bab, seat of the Universal House of Justice, and the Terraces, among many other buildings visited by Baha'is during their 9 day pilgrimage. Another attraction is Kababair, a village integrated in the city of Haifa, populated by Moslem inhabitants belonging to the Ahmedi sect. Opposed to all forms of coercion aggression or violence, they believe that Islam should be spread by information and by persuasion. Haifa also has the great caves of Elijah the Old Testament prophet, visiting these caves and having meditation creates peace and harmony in one's heart. Mount Carmel, or the Vineyard of God is like heaven on Earth with food for the Soul,Mind and the Spirit. Visiting this City and Akko can enrich the soul in many ways.
A daytrip can be made to the medieval walled fortress city of Acre Directly north you find the heights of Rosh Hanikra, the majestic white cliff, checkpoint on the Israel - Lebanon border. Further east towers the snow capped peak of Mount Hermon.

It may be cliched, but that doesn't mean you shouldn't do it. No trip to Israel is complete without a float in the Dead Sea. You'll be doing your body a favour as the water is packed full of invigorating minerals and there's 10% more oxygen in the air here than at sea level.
The area around the Dead Sea has plenty to keep you entertained once you've floated to your heart's content. Ein Gedi is one of the country's most attractive oases, a lush area of freshwater springs, waterfalls, pools and tropical vegetation and a haven for desert wildlife.
Galilee
Serious Bible territory, this is where Jesus did most of his preaching as well as a spot of water walking and some fish multiplying. It's also Israel's lushest region, with green valleys, verdant forests, fertile farmland and the Sea of Galilee.
Nazareth, Jesus' childhood home, is a popular destination for pilgrims, but not much chop for the casual visitor. Although there are some important churches here, such as the Basilica of the Annunciation where the Angel Gabriel appeared to Mary, the town itself has seen better days.

Culture
Until recently, Israel's culture has been predominantly religious, be it Jewish, Christian or Muslim. Although the scoutlike kibbutz feeling is still in evidence, and although Judaism is the state religion, Israel is rapidly turning into a cosmopolitan consumerist society. Most Jewish Israelis play it both ways, leading a largely secular life but still taking part in the occasional religious ceremony. This is not to say that orthodoxy has died out: on the contrary, orthodox factions are becoming stronger and stronger, and their calls for a return to religion are louder and louder. Many Orthodox - and particularly Hasidic - Jews are recognisable by their dark clothes, beards and curly sideburns (although women tend to forego the beards and sideburns).
In Palestinian parts of the country, Muslim culture is more evident: you'll generally see fewer women, and those that you do see will be dressed more modestly. Sunni is the predominant Muslim sect. Family and hospitality are very important in Palestinian life, and most Palestinians are extremely friendly and helpful to strangers, going so far as to welcome them into their homes.

Israeli eating habits are dictated to some extent by religious laws - Jews cannot eat dairy and meat products together, nor can they eat 'unclean' birds or fish, and neither Muslims nor Jews can eat pork. The waves of immigrants have all brought their own cuisine with them, and you will find Yemeni Jewish food (flame-grilled meats, stuffed vegetables and an astonishing array of offal) and Eastern European Jewish food (schnitzel, goulash, gefilte fish and blintzes). Observant Jews are not permitted to cook on the Sabbath, so for most of Saturday they will eat cholent, a heavy stew cooked on Friday night. Arab dishes include felafel (ground chickpeas flavoured with spices and deep fried), tahina (sesame paste), houmus (chickpea and garlic paste) and flatbreads. Religious laws proscribe alcohol for Muslims, so tea (Arab-style with mint and a truckload of sugar) and coffee are popular beverage mainstays. Palestinians also make juices from tamarind, dates and almonds.