Most of the mandates continued until after World War II, although the people of the occupied countries were eager for independence. The major European nations, however, were concerned with the question of a homeland for the Jews. In response to Zionism, the movement devoted to this cause, Britain in 1917 issued the Balfour Declaration, favoring establishment of a Jewish homeland in Palestine. The policy was endorsed by the League of Nations. In anticipation, Jews began emigrating to Palestine, where they were met with hostility. The Arabic-speaking countries gradually united in opposition to a Jewish nation in the Middle East.

Consideration of a British plan of 1939 for a Palestinian nation to be shared by Arabs and Jews was interrupted by World War II. During the war Britain centered its Middle East operations in Egypt and stopped a German drive for the Suez Canal at El Alamein in 1942. In 1945 Arab countries founded the Arab League. When the nation of Israel was created from portions of Palestine in 1948, league members went to war in a vain attempt to destroy it.

Britain, long dominant in Persia (called Iran from 1935), Iraq, Arabia, and Egypt, withdrew gradually from the Middle East after World War II, and the Soviet Union attempted to gain influence there. Middle East investments became increasingly attractive to foreign countries, as the rate of development of the region's vast petroleum reserves was accelerated. The oil industry was largely owned by Western companies through concessions granted them by Middle East governments.

By the 1970's Turkey, Israel, Jordan, Iran, and Saudi Arabia had close ties with the United States; Syria, Iraq, and Libya with the Soviet Union. Egypt had maintained close relation? with the Soviet Union for years, but broke those ties in 1976.

By the end of the 1970's, most of the Middle East oil-producing countries, including Iraq, Saudi Arabia, and Kuwait, had nationalized foreign-owned oil operations, ending the concession system. Through OPEC (Organization of the Petroleum Exporting Countries), which was formed in 1960, the oil-producing nations during the 1970's were able to greatly increase prices. This led to substantial growth in wealth and to increased influence of the Middle East in international affairs.

Beginning in the late 1970's, a rise in Islamic fundamentalism, in reaction to growing influence by Western and Soviet-bloc nations, was the source of much unrest and rebellion in the region. In Iran, Shiite fundamentalists overthrew the shah in 1978. In Egypt, President Anwar Sadat was assassinated in 1981 by the Muslim Brotherhood, a fundamentalist Sunnite group.

Lebanon was long dominated by Christians, but during a civil war from 1975 to 1990, Muslim fundamentalist groups gained more power in the government.

In 1980 Iraq under Saddam Hussein invaded Iran in an attempt to win back territory it had ceded in 1975. The invasion was pushed back in 1982, and the war stalemated. It ended in 1988.

In 1990, Iraq invaded and annexed Kuwait. The United States, Great Britain, France, Egypt, Syria, Saudi Arabia, Kuwait, and 30 other countries formed a coalition under United Nations auspices to oppose Iraq. In 1991, the coalition forces in what became known as the Persian Gulf War defeated Iraq and freed Kuwait. Following the war, Kurdish and Shiite groups in Iraq launched rebellions against Saddam Hussein, which he quickly crushed.