The traditional band, led by Cathy Jordan, has been forced to pull out of their three-date tour in the country, after falling victim to what a Government minister has described as online "intimidation and bullying".
Justice Minister Alan Shatter said that the call from Irish Palestinian Solidarity Group to oppose Dervish's tour over the internet was "nothing other than cyber-bullying".
"The invitation to Dervish to perform in Israel came from a fellow musician ... and the objective of the concerts was 'to promote love between two divided communities'," he said.
On the band's social networking page, singer Cathy said: "In hindsight, it was very naive of me to think our motives would not be misunderstood and misrepresented."
Some artists have chosen to boycott Israel in protest at the treatment of the Palestinian people.