This article argues that 40 years of EU peacebuilding in the Israeli-Palestinian conflict have produced few significant results with a possible exception to this being the parameters provided by the EU for a just peace in the conflict. In any case, it is difficult to characterise these past four decades of EU involvement as anything other than a failure. Consequently, the main argument of this article is that a new strategy for the EU’s peacebuilding in the Israeli-Palestinian conflict is urgently needed. As both the approaches of conflict management and conflict resolution have been tried and have failed, this article argues that the EU has far better potential in transforming the Israeli-Palestinian conflict than in managing or resolving it. An EU strategy more clearly based on the principles of conflict transformation is therefore the best way forward for the EU in the Middle East peace process.