Like many other multiethnic countries, Malaysia has seen a revival in Islamic fundamentalism in her Muslim populace since the seventies. The ongoing revival has led to pressures on the Malaysian government to establish an Islamic state in the country. Since the eighties, this revival is associated with a deterioration in political relations between Muslims and non-Muslims and a heightening of domestic tensions in the country. This study examines the process by which the activities of Islamic revival movements have contributed to the polarization in Malaysia's domestic politics. The study analyzes the characteristics of the revival and the impact on some key areas of Malaysian politics. These areas include Muslim and non-Muslim interests, governmental response to the revival, responses of major political parties, and changes in the alignment of popular support for these political parties. The study shows that the government has adopted conciliatory responses toward the demands of Muslim revivalists because of the pivotal role of the Muslim vote in the electoral process. Such responses have been detrimental to the interests of non-Muslims, resulting in a deterioration in relations between Muslims and non-Muslims at the grassroots level, and a polarization of support for political parties along ethnic lines. If the momentum of the revival continues, interethnic relations are likely to continue deteriorating.