11 April – Operation Grapes of Wrath: The Israeli government launches the Operation, consisting of massive attacks on Lebanon, in retaliation for prior terrorist attacks, and sparking off a violent series of retaliations.
18 June – Prime Minister Benjamin Netanyahu presents his cabinet for a Knesset "Vote of Confidence". The 27th Government is approved that day and the members were sworn in.
5 November – Israeli DruzeAzzam Azzam is arrested in Egypt on suspicion of spying for Israel. Later on, a military court in Cairo sentenced Azzam Azzam to 15 years imprisonment with hard labor.
30 December – Netanyahu proposed budget cuts, sparking protests from 250,000 workers, who went on strikes across Israel.
Israeli–Palestinian conflict
The most prominent events related to the Israeli–Palestinian conflict which occurred during 1996 include:
24 April – After a two-day meeting in Gaza City the PNC adopts two resolutions amending the PLO Charter.
2 May – Emil Habibi (b. 1922), Israeli Arab author, Knesset member and public activist.
26 May – Haika Grossman (b. 1919), Polish-born Israeli politician and member of Knesset. Zionist leader in Europe, a partisan and a participant in the ghetto uprisings in Poland and Lithuania
^Morris, Nome; Silver, Eric (7 October 1996). "Israel Opens Disputed Tunnel". Maclean's Magazine. Archived from the original on 7 June 2011. Retrieved 29 July 2009.