KFC will open a restaurant around Christmastime in Nazareth, which is known as the Arab capital of Israel. The parent company, not a franchisee, will operate the new location, The Times of Israel reported.
KFC pulled out of Israel in 2012 after trying to build its brand there in the 1980s and 1990s.
Unlike in the past, the chicken will not be kosher because of impact on taste and price, The Times of Israel reported.
KFC already has six locations in the West Bank where Palestinians live.
In other KFC news, FC is decking the halls and designing limited-edition holiday buckets, featuring artwork by award-winning children's book author and illustrator Nicholas John Frith.
The U.S. makes up about 17 percent of KFC's revenue. KFC outlets are now located in more than 140 countries and territories, according to the chain's website.
FOX Business' inquiry to KFC was not immediately returned.