Recent decades have seen a major political shift in many nations, manifested in democratic regression, rise of populist non-liberal democracies, resurgence of extreme right, infractions against democratic watchdogs, and increasing nationalism and unilateralism. A central manifestation of this process is the active encroachment by governments on civil society, and particularly on its liberal elements. These manifestations allegedly emanate from resistance to the liberal world order and to threats from pressures imported by national NGOs, and are made possible by changing political opportunity structures. We explore the case of Israel, through an analysis of the New Israel Fund (NIF), as a particular yet demonstrative example of these dynamics. The manifestations of civil society encroachment in Israel include concerted and coordinated actions meant to weaken and delegitimize left-wing civil society actors and their supporters and donors, by Israel’s right-wing governments and their NGO allies, through legislation and rhetorical assaults; attempts to curb international funding of human rights organizations; and differential treatment of civil society organizations according to political stance. Interviews with former and current leaders of the NIF show that the attacks have galvanized liberal civil society actors to counteract, and drove them from passive response to active and strategic engagement, professionalization of media work and program evaluation, adjustment of public relations and legal strategies, and even adjustment of programmatic choice, shifting focus to supporting the infrastructure of civil society and democracy. The discussion stresses pressures by international illiberal forces, alongside the backlash to liberal world society, as causes for encroachment, and highlights the less explored reactions of civil society actors to such encroachment.