But some liberal Israelis are more accepting of the Palestinian move, seeing it as an unpleasant step that just might prod Israel onto a peace track.
Israelis are used to international outrage over their nearly 50-year control over the West Bank, the territory claimed by the Palestinians as the heartland of their future state.
But while UN condemnation and Washington and European admonitions of Israeli settlement construction are generally ignored, the threat of being kicked out of the world's pre-eminent sporting body has caught people's attention.
Netanyahu praised the Israeli effort that fended off the Palestinian attempt to kick it out of FIFA a battle that played out at last week's conference in Zurich, though it was overshadowed by the FIFA election and the scandal surrounding the soccer federation.
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At the last minute, the Palestinians agreed to a compromise that averted a vote, but it came with a hefty price for Israel.
Emboldened by the gains, Palestinians are considering similar actions at the Olympics and in other international arenas.
For days, Israeli airwaves and newspapers have been filled with dire warnings that the FIFA bid is just the beginning of a massive anti-Israel action, all part of a broader Palestinian strategy to target Israel in international institutions such as the United Nations and International Criminal Court.
"The problem is not in the international institutions, but in the Israeli occupation," said Palestinian official Saeb Erekat. "What we are doing is just a means to end the Israeli occupation."