This article investigates the relationship between trade and politics, particularly the effect of improved or deteriorated political ties upon economic relations with particular reference to the bilateral trade and diplomatic relations between Turkey and Israel. The study attempts to identify under what conditions bilateral trade is affected by any significant change in political relations. It finds that economic relations were relatively bolstered at times of enhanced political relations whereas visible deterioration or decline was observed in the volume and state of trade relations at some critical points when diplomatic relations worsened. However, this does not refer to a constant and steady decline and is limited to some severe diplomatic crises experienced in bilateral relations. Some major premises of Realist and Liberal theories are employed to analyse the findings in this study. These findings are at least partially against the main arguments in the literature of the Liberal approach that trade determines politics. However, the course of trade relations between Israel and Turkey appears to be consistent with the tenets of the Realist theory which pays greater attention to security than it does to trade relations and argues that trade may not be relevant to improved bilateral political relations.