The media and communication rights of Palestinians in Israel are designed to deny them of collective cultural rights, specifically the right to express their identity through the mass media and to participate equally in the process of national culture building. Through a critical analysis of the documents that shape the media industry in Israel and their historical evolution, this paper lays bare the assumptions underlying Israeli media policies. The policies are designed in a discourse branding `Palestinian-Israelis' a linguistic minority, and portraying them as the `enemy within', thus barring their participation in the development of Israeli culture by limiting their electronic media participation to separate channels targeting both them and Arabs in neighboring states. The paper argues that this policy stems from a narrow interpretation of `democracy' that rejects identification with the Orient and embraces neo-liberalism.