Similar to other national contexts, in Israel since the 1980s we have witnessed the emergence of neo-liberal policies in education. However, very little attention has been given to the ways in which they affect the school level and even less attention has been given to the impact of these policy changes on Arab schools in Israel. This article offers a micro-politic policy analysis of the ways in which neo-liberal discourses and practices of selection are being interpreted and acted upon in one Arab high school in Israel as a unique example of minority education. It also examines the interplay between these policy changes and other discursive fields within which Arab schools operate, such as its marginalisation. In light of neo-liberal discursive shifts in education policy in Israel, this article revisits the control-empowerment explanation of the position of the Arab education system in Israel.