Interesting article today in the Jerusalem Post by Seth Frantzman about the development of Freemasonry in Israel.See Terra Incognita: The first economic peace in the Holy Land
Since its inception, Freemasonry has welcomed Jews as members, and initially most Jewish Masons were from prominent Sephardi families. One of these, Moses Montefiore, is important because of his connection to 19th-century Palestine, where he helped improve the living conditions of local Jews. However, the first Masonic ceremony held in Jerusalem was conducted by a Kentucky-born Mason named Robert [sic] Morris at the Cave of Zedekiah (popularly known as King Solomon's Quarries) near Damascus Gate in east Jerusalem. Another Masonic lodge, the Royal Solomon Mother Lodge, was founded in Jaffa in 1873 by American settlers of the Adam's colony. The colony failed, and the lodge was maintained by Rolla Floyd, a survivor of the colony. Another lodge was founded in 1890 in Jaffa by middle-class Jews and Arabs.
The Masonic lodges at this time included Jewish and Arab notables. One example of these, according to an article written by Israeli Mason Leon Zeldis, was a Christian Arab hotel owner named Iskander Awad who was also an agent for the Thomas Cook travel agency. Lodges were founded in Haifa (1911) and Jerusalem (1931), and in each case the membership was composed of leading Jews, Arabs and Europeans.
Dr. Daniel Farhey, a Mason based in Haifa, has written that "Freemasonry is one of the few institutions that actively promotes better understanding between the different ethnic and cultural segments of Israel society, particularly between Jewish and Arab brethren, and also assists in the social integration of immigrants."
Nevertheless, not everybody in the region is thrilled with the growth of Masonry. Frantzman points out that Hamas describes Freemasonry as a "secret society" controlled by Zionism, and the term "Freemason" is specifically mentioned three times in the Covenant of Hamas adopted in 1988.
See also the Grand Lodge of the State of Israel website.
