Most of the challenges faced by the Palestinian higher education institutions (HEIs) towards internationalization stem from the problematic nature of bilateral relations of the Palestinian Authority (PA) in West Bank and Gaza Strip (WBGS) with Israel. Evaluating the geo-political, socio-economic, historical, and organizational barriers to internationalization of higher education in the WBGS, the chapter elaborates on the cumulative effects of the Israeli direct and indirect control over the WBGS on the development of universities, the impact of geo-political restraints of being a conflict zone, and logistical restrictions imposed on the movement of academics, visitors, and academic materials. Various domestic challenges including the political and ideological differences within the PA, the quality of national-level governance, and planning in higher education and financing are also highlighted throughout. Referring to the catalysts and obstacles, the chapter concludes with a reflection on the future challenges and prospects facing the Palestinian HEIs in a dynamic yet challenging context.