The Fifa Council has ordered investigations into alleged breaches of its rules by Israel.
The Palestinian Football Association (PFA) had called for the suspension of its Israeli counterpart at Fifa's Congress in May.
Fifa president Gianni Infantino said at the time that an independent legal assessment was required and based on that, the Fifa Council has now mandated the initiation of two investigations into the Israel Football Association (IFA).
The first will be into allegations of discrimination within its national league, and will be conducted by Fifa's disciplinary committee.
The second will consider the participation in Israeli competitions of Israeli football teams allegedly based in the territory of Palestine. This investigation will be entrusted to the Fifa Governance, Audit and Compliance Committee, Fifa said.
Article 72 (1) of the Fifa Statutes states that "member associations and their clubs may not play on the territory of another member association without the latter's approval".
The announcement of the investigations comes at a time when tensions in the Middle East have further escalated.
"The Fifa Council has implemented due diligence on this very sensitive matter and, based on a thorough assessment, we have followed the advice of the independent experts," Infantino said.
"The ongoing violence in the region confirms that, above all considerations, and as stated at the 74th Fifa Congress, we need peace.
"As we remain extremely shocked by what is happening, and our thoughts are with those who are suffering, we urge all parties to restore peace to the region with immediate effect."
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