The long-standing pillars in the grand strategy of Israel—namely, the qualitative edge principle and self-reliance in defence—enabled considerable cybersecurity achievements. Israel, the sole developed nation facing existential threats, has carried out audacious cyberspace operations yet never suffered material damage from cyberattacks. ‘Made in Israel’ inventions have long been embedded in building blocks of the global digital technologies, and drive much of the economic boom. As high-technology innovation flourishes, strategic choices taken over many decades created the foundations of Israel’s vibrant innovation ecosystem. Power, the currency of international relations, undergoes technology-driven change. Innovation capacity grows in importance in periods of profound change. Cyber power must be smart, integrating hard and soft power. The official Israel now shares sensitive cybersecurity expertise with foreign stakeholders, aiming to advance a range of foreign policy goals from counterterrorism to sustainable development. The milestones in Israel’s national cybersecurity evolution include the 2002 state-guided Critical Infrastructure Protection (CIP); the 2011 official national cybersecurity strategy with ambitious goals and comprehensive scope; and the most recent developments in the Israel National Cyber Directorate (INCD) and the Israel Defence Forces (IDF). However, Israel’s cybersecurity journey is far from complete. Harnessing digital transformation, in particular narrow artificial intelligence and intelligent systems, requires further profound innovation in national security. This chapter outlines four guiding principles and forces shaping Israel’s cybersecurity, and sketches three long-term policy challenges for Israel. As long as a coherent strategy guides innovation, Israel as well as other small nations can gain and utilize ample cyber power.