Since the creation of the Jewish state, the relations between Iran and Israel have undergone various stages, including covert relations. The fact is that for nearly thirty years, from 1948 until 1979, both states cooperated in certain areas such as trade and intelligence. Even after the Islamic revolution of 1979 both states covertly made arms agreement for a joint cause.But soon after the Iran-Iraq war relations between these states seriously deteriorated. This paper outlines the reasons which played an important part in development and extermination of relations between the two regional players. The history of Iranian-Israeli relations since 1948 and the regional and international changes that occurred had far reaching consequences for both countries. The paper will focus on this analysis as well.