This paper explores the process of national identity development, and closely related themes among Palestinian student activists in the Israeli universities. Informed by the tradition of social identity theory, in-depth qualitative inquiry was conducted with an intensity sample of 35 Palestinian student activists attending the major five Israeli universities. Grounded theory analysis conducted on the open-ended interviews, document analysis and field observation revealed five dominant themes, which characterize Palestinian student activist. First, national identity was conceived as a cause of involvement in student activism, and as a psychological construct, which was reconstructed and developed through the experience of activism itself. Second, a sense of group relative deprivation in comparison with the dominant Jewish group was prevalent and closely related to the students' sense of national identity. Third, political party membership constitutes a mid-range identity linking the individual and the collective levels of identity. Fourth, women student activists advocated an intertwined feminist-nationalist agenda. Finally, psychosocial development and adjustment was revealed as an outcome of involvement in student activism. Findings reinforce the vital role of the student movement as a national socialization context in light of the continuing Israeli hegemonic practices over Palestinian formal education. (Contains 1 table.)