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While countries may differ considerably in their counter-terrorism strategies, there are some shared features across contexts, namely the use of incapacitation in the form of arrests, incarcerations, and sometimes killings of offenders. These counter-terrorism practices mirror those in anti-crime settings, where they are similarly intended to deter future offending. However, in contrast to research on crime, evaluation studies on the impact of such factors on terrorism remain scarce. Most studies on the topic have only examined the effects of specific policies. In this study, we examine the impact of incarceration and neutralization on terrorism trends in the Israeli context. Our study employs a vector-autoregressive framework on monthly data from 2009–2023 (N = 177). We find that incarceration consistently acts as a deterrent to terrorism, as does reducing human capacities through injuries inflicted on offenders, while neutralization remains non-significant across models. Our results highlight the relevance of applying traditional anticrime interventions to deter terrorism. They also underscore the applicability of deterrence-based theories to examine terrorism. As such, our findings hold important implications for both policy development and future research endeavors.