Since the Eretz Israel Football Association was founded in 1928, it has organised a nationwide knockout cup competition almost every football season. This cup was originally held in Mandatory Palestine and named the People's Cup, but when Israel became independent in 1948, the tournament was renamed the Israel State Cup. "Eretz" was dropped from the association's name at the same time. The present cup holders are Bnei Yehuda Tel Aviv who beat Maccabi Tel Aviv 4-3 in a penalty shootout after a goal-less match at the 2017 final.
Scheduling was initially inconsistent, but the State Cup has been a regular fixture in the Israeli football calendar since the start of the 1961–62 football season. It involves professional and amateur clubs of all standards playing against each other, creating the possibility for "minnows" to become "giant-killers" by eliminating top clubs from the tournament. Five teams have reached the final while playing in a lower division, but all have been defeated apart from Hapoel Ramat Gan, who won the cup final while a second-tier club in 2003. British police and military teams took part in large numbers during the Mandate Period, and one, British Police, won the competition in 1932.Bnei Sakhnin, the 2004 final victors, are the only side from a mostly Arab-Israeli town to have lifted the cup.
Maccabi Tel Aviv have a record 23 cup titles, followed by Hapoel Tel Aviv, who have 15, including two unmatched runs of three in a row (1937 to 1939, and 2010 to 2012). The sustained good performance of Beitar Jerusalem, the next most successful team in terms of State Cup wins with seven, is a relatively recent occurrence compared to the two major Tel Aviv clubs: Maccabi and Hapoel Tel Aviv have been consistently successful throughout the cup's history, but Beitar Jerusalem only reached their first finals in the 1970s. Hapoel Kfar Saba are presently the only club with more than one final appearance to hold an undefeated record in these matches, having won the cup final three times, every time they have reached it. By contrast, three-time finalists Shimshon Tel Aviv have yet to lift the trophy. The most decisive cup final victory was in 1942, when Beitar Tel Aviv beat Maccabi Haifa 12–1.