This paper argues that underneath the dual legal system in Israel and the Occupied Palestinian Territories (OPT), lies one carceral state. Legally, in order to maintain international legitimacy in accordance to international law, Israel has operated under international law in refraining from annexation of the OPT and maintaining a separate legal system. However, while initially the carceral system also followed international law’s separation imperative - imprisoning Palestinians inside the OPT - that has changed dramatically. Between the Oslo Accords and the aftermath of the Second Intifada, more and more prisons and prisoners have been transferred into Israeli territory. Ultimately, by 2006, all prisons but one were physically transferred into Israel, and the responsibility for all prisons was reallocated from the military to the Israeli Prison Service (IPS), rebranded as the “National Prison Authority”. This shift represents the growing gap between the performative and the actual, the legal and the administrative. On the administrative level - opaque to the international community - the carceral system in the entire territory of Israel and the OPT is managed by a single system, and the one carceral state has become a reality. The paper outlines some of the implications of the one carceral state, by analyzing administrative documents of the IPS, the Knesset, and Supreme Court decisions, spanning 50 years. First, in the one carceral state, the mass incarceration of Palestinians is not exceptional but endemic. Since 1967, Israel confined over 800,000 Palestinians from the OPT, approximately 20% of the population and 40% of the male population. When the prisoner population is looked at as a whole, any given time Palestinian prisoners from the OPT comprised between one third to a half of the total prisoner population, and they are held and managed together with Palestinian citizens defined as “security prisoners”. The scale and demographics of incarceration, its disproportionate growth, and the immense share of a particular ethno-national group lacking citizenship and voting rights, are all troubling features of mass incarceration. Second, despite their non-citizen status, incarceration functions as a form of inclusion, when Palestinian prisoners become entitled to prisoners’ rights under Israeli law, like education and parole. Subsequently, authorities have been contending with prisoners claiming these entitlements. Israel has thus established “carceral citizenship” for Palestinian prisoners, placing them in a liminal position, while the content of carceral citizenship is subject to ongoing negotiation between prisoners and prison authorities of the one carceral state.