Classified Red Cell report points to political fracture, military manpower shortages, economic pressures, Haredi tensions, emigration and growing settler violence as threats to the Zionist entity.

WASHINGTON -- A classified CIA assessment has warned that Israel is at risk of “civil war or state collapse,” according to a new report co-published by Drop Site News and Capital & Empire, released Monday.

The report was drafted in August and is titled “Fracture from Within.” It was put together by “experts in the CIA’s Red Cell,” two U.S. sources told Drop Site News.

The Red Cell provides “alternative analysis” within the CIA. It drafted the report using a mix of open-source information and U.S. intelligence. “The assessment appears to refer only to Israel’s Jewish citizens,” Drop Site News added.

CIA experts cited in the report point to “a volatile mix of pressures” including the Israeli economic crisis, heightened military spending, and the Haredi crisis, which has seen Ultra-Orthodox Jews continue efforts to evade military service. This has compounded a serious manpower crisis within the Israeli military.

Pressures include “heavily armed veterans returning from prolonged combat, many carrying serious psychological trauma,” as well as increased settler violence and prime minister Benjamin Netanyahu’s “fighting to hold onto power and igniting a constitutional crisis.”

The CIA assessment warned about soaring food prices in Israeli occupied territories, which have reached record highs.

“The combination of political fracture and a growing population of heavily armed, traumatized veterans has historical precedents. Famously, the Freikorps of Germany were PTSD-addled veterans with weapons and bloodthirst. I’m not saying Israel post-Gaza is Germany post-WWI, but there are certainly aspects of this that ring similar to me,” one source said.

The report points to Israel “increasingly becoming a pariah state” as a factor that could result in the collapse of the Zionist entity.

“One of the deepest fractures in Israeli politics has emerged not over opposition to the country’s war crimes – but over who is expected to fight and who is exempt,” they added.

These warnings are corroborated by Israeli military sources. Israeli army chief Eyal Zamir has repeatedly warned of a potential collapse in the reserves.

In March 2026, Zamir told a security cabinet meeting: “I am raising 10 red flags in front of you. Right now, the IDF needs a conscription law, a reserve duty law, and a law to extend mandatory service. Before long, the IDF will not be ready for its routine missions and the reserve system will not last.”

Occupying brigades and battalions in Lebanon are operating below full capacity and strength, Israeli Army Radio reported on July 14.

“There aren’t enough tanks,” the report said. “Reserve units today are hollow,” a reserve commander is cited as saying. The broadcaster cited a reserve company that completed an operational mission in Lebanon with only one officer remaining, with no functioning chain of command.

Weeks later, Hebrew media shed light on another concern – emigration from Israeli occupied territories.

According to an August 2026 study released by Tel Aviv University, record numbers of Israeli settlers left the occupied Palestinian lands in 2025. The numbers were referred to as “deeply concerning”.

Nearly 270,000 Israeli settlers left the territories for at least three consecutive months between 2023 and 2025, with 90,922 departing in 2025 alone. Researchers estimated that 45,000 to 50,000 Israeli settlers likely remained abroad for at least a year in 2025.

The data showed those leaving were highly educated, high-earning professionals including doctors, engineers, and tech workers. In 2024 alone, 530 physicians left Israeli occupied territories.

Several months before the start of the genocide in Gaza, which is entering its third year, a Hebrew Channel 12 poll said a majority of Israeli settlers were fearful over the Zionist entity’s future.

A June 2026 Channel 12 poll found that 74% of Israeli settlers fear another October 7-style attack, while 66% support a state commission of inquiry into the failures leading to the operation.

The findings echo the prediction of martyred Leader of the Islamic Revolution Ayatollah Seyyed Ali Khamenei, who declared in 2015 that Israel would not see 25 years — a statement that now appears increasingly prophetic.

The new intelligence report comes to light just a few weeks ahead of Israel’s general election. Hebrew media cited military sources as saying recently that Netanyahu seeks to escalate the genocide of Palestinians in Gaza and initiate new wars in West Asia to “disrupt or delay” upcoming elections.

Israeli military analyst Amos Harel noted in Haaretz that renewed confrontation with Iran aligns with Netanyahu’s longstanding desire to ignite war, and comes as Israel prepares for elections seen as fateful for his political future.

The report emerges amid mounting scrutiny over a false-flag hijacking that many observers believe was designed to serve Netanyahu's political survival.

The operation was discussed and finalized during a secret visit by Netanyahu to the United Arab Emirates three days before a flydubai flight from Dubai to Tel Aviv was diverted to Saudi Arabia on September 30.

Netanyahu was reportedly accompanied by senior Israeli military and intelligence officials, and discussions involving officials from several Arab countries focused on devising an operation that could subsequently be attributed to Iran.

Netanyahu fears that if Knesset elections proceed, his coalition will fail to secure a majority, and that after being removed from office he would "have to spend the rest of his political life behind bars."