The economy of Israel is technologically advanced by global standards. As of 2015, Israel ranks in the top 20 nations in the world on the UN's Human Development Index, which places it in the category of "Very Highly Developed", allowing the country to enjoy a high standard of living. The prosperity of Israel's advanced economy allows the country to have a sophisticated welfare state, a powerful modern military said to possess a lethal nuclear-weapon's capacity, modern infrastructure rivaling many Western countries, and a high-technology sector competitively on par with Silicon Valley.

The country's major economic sectors are high-technology and industrial manufacturing; the Israeli diamond industry is one of the world's centers for diamond cutting and polishing. Relatively poor in natural resources, Israel depends on imports of petroleum, raw materials, wheat, motor vehicles, uncut diamonds and production inputs, though the country's nearly total reliance on energy imports may change with recent discoveries of large natural gas reserves off its coast on the one hand and the leading role of the Israeli solar energy industry on the other.

Israel's quality university education and the establishment of a highly motivated and educated populace is largely responsible for ushering in the country's high technology boom and rapid economic development. With its strong educational infrastructure and high quality incubation system for new cutting edge ideas to create value driven goods and services has allowed the country to create a high concentration of high-tech companies across the country financially backed by a strong venture capital industry. Its central high technology hub "Silicon Wadi" is considered second in importance only to its Californian counterpart. Numerous Israeli companies have been acquired by global corporations for their reliable and quality corporate personnel.

The economic dynamism of Israel has attracted attention from international business leaders such as Microsoft founder Bill Gates, investor Warren Buffett, real estate developer and U.S. President Donald Trump and telecommunications giant Carlos Slim. Each entrepreneur has praised Israel's economy and invested heavily across numerous Israeli industries beyond their traditional business activities and investments back in their home nations.

Israel is also a major tourist destination, with 3.54 million foreign tourists visiting it in 2013.