A movement designed to return Muslim countries, many of whom are ruled by secular governments, to a system of government based on the principles of the Koran. Islamic fundamentalism made its first impact in recent history in 1979, when it was responsible for the overthrow of the Western-backed Shah of Iran, replacing him with a virulently anti-western government that was strongly influenced by conservative Islamic clerics.

Islamic fundamentalists oppose the Westernization of their countries because they believe it undermines the traditional religious values of their society. They want to install Islamic law, shari'a, under which, for example, alcohol would be outlawed, and sexes would be segregated in the workplace. Islamic law is also known for its harsh penal code, including the amputation of hands and feet of criminals. Islamic fundamentalists waged an unsuccessful civil war against Algeria's secular government in the 1990s. Fundamentalism in the form of the Muslim Brotherhood is also a force in Egypt and other Arab countries, and amongst the Palestinians, in the form of Hamas.

There is a widespread fear in the West that Islamic fundamentalism in its militant form could become a strong destabilizing force in Europe, North Africa and the Middle East. Some even suggest that now that the Cold War is over, Islamic fundamentalism has replaced the Soviet Union as the greatest danger to the West. This is an extreme view, and ignores the diversity amongst Muslim groups, not all of whom are a threat to Western interests. However, in the wake of the terrorist attacks on the United States in September 2001, fear of Islamic radicalism has only increased in the West.