The Israeli parliament has passed a law that allows the state to deny funding to institutions that question the country's existence as a Jewish state.
Civil rights groups say the law restricts the freedom of expression of Israel's Arab minority, which makes up about a fifth of Israel's population.
The controversial law brought in by the far-right Yisrael Beiteinu party was passed by a vote of 37 to 25.
The new law has been called the Nakba bill, the Arabic word for catastrophe.
Palestinians use the term to refer to the creation of the state of Israel in 1948, when hundreds of thousands of them fled or were forced from their homes.
Under the new law, groups involved in activities that deny Israel's existence as a Jewish state can be prevented from receiving public funding.
Those activities include marking Israel's Independence Day as a day of mourning.
Civil rights and Israeli Arab politicians say the law is undemocratic and unfairly singles out Israel's Arab citizens.
The current version of the law is more moderate than the original, which called for prison sentences for anyone holding Nakba memorial events.