This is an extremely important point to grasp because it explains why there is so much confusion regarding the relationship between the church and Israel. The answer depends on whether we are talking about national Israel or true Israel. The church is distinct from national Israel, just as the true Israel in the Old Testament was distinct from national Israel even while being part of national Israel. The remnant group was part of the whole but could also be distinguished from the whole by its faith.

One of the most common questions asked by students of the Bible concerns the relationship between Israel and the church. We read the Old Testament, and it is evident that most of it concerns the story of Israel. From Jacob to the exile, the people of God is Israel, and Israel is the people of God. Despite the constant sin of king and people leading to the judgment of exile, the prophets look beyond this judgment with hope to a time of restoration for Israel. When we turn to the New Testament, the same story continues, and Israel is still in the picture. Jesus is described as the one who will be given “the throne of his father David” and the one who “will reign over the house of Jacob [Israel] forever” (Luke 1:32–33). He is presented as the One the prophets foresaw.

The first to believe that Jesus is the promised Messiah are Israelites—Andrew, Peter, James, John. But in the Gospels, we also hear Jesus speak of building His church, and we see growing hostility between the leaders of Israel and Jesus. We hear Jesus speak of destroying the tenants of the vineyard and giving it to others (Luke 20:9–18). In the book of Acts, the spread of the gospel to the Samaritans and gentiles leads to even more conflict with the religious leaders of Israel. So, is Israel cast aside and replaced by this new entity known as the “church”?

There are those who would say yes, but the answer is not that simple, for we also run across hints that God is not finished with the nation of Israel. At the end of His declaration of woes on the scribes and Pharisees, Jesus says, “You will not see me again, until you say, ‘Blessed is he who comes in the name of the Lord’” (Matt. 23:39). In the Olivet Discourse, He speaks of Jerusalem being trampled underfoot “until the times of the gentiles are fulfilled” (Luke 21:24). In Acts, Peter says to a Jewish audience:

Repent therefore, and turn back, that your sins may be blotted out, that times of refreshing may come from the presence of the Lord, and that he may send the Christ appointed for you, Jesus, whom heaven must receive until the time for restoring all the things about which God spoke by the mouth of his holy prophets long ago.
Acts 3:19—21

Finally, Paul says things about Israel that seem to preclude total rejection. Speaking of Israel, he writes, “I ask, then, has God rejected his people? By no means!” (Rom. 11:1).

In order to understand the relationship between Israel and the church as described in the New Testament, we will need to look at the question in the context of the different answers Christians have given over the years. The traditional dispensationalist view maintains that God has not replaced Israel with the church but that God has two programs in history, one for the church and one for Israel. Traditional dispensationalism also maintains that the church consists only of believers saved between Pentecost and the rapture. The church as the body of Christ does not include Old Testament believers. Progressive dispensationalism has modified some of these views, but the traditional dispensationalist view remains very popular. Some covenant theologians have adopted a view that many dispensationalists describe as “replacement theology.” This is the idea that the church has completely replaced Israel. Jews may still be saved on an individual basis by coming to Christ, but the nation of Israel and the Jews as a people no longer have any part to play in redemptive history.

A careful study of the New Testament reveals that both of these interpretations of the relationship between Israel and the church are wanting. The relationship between the people of God in the Old Testament and the people of God in the New Testament is better described in terms of an organic development rather than either separation or replacement. During most of the Old Testament era, there were essentially three groups of people: the gentile nations, national Israel, and true Israel (the faithful remnant). Although the nation of Israel was often involved in idolatry, apostasy, and rebellion, God always kept for Himself a faithful remnant—those who trusted in Him and who would not bow the knee to Baal (1 Kings 19:18). This remnant, this true Israel, included men such as David, Joash, Isaiah, and Daniel, as well as women such as Sarah, Deborah, and Hannah. There were those who were circumcised in the flesh and a smaller number who had their hearts circumcised as well. So, even in the Old Testament, not all were Israel who were descended from Israel (Rom. 9:6).

At the time of Jesus’ birth, the faithful remnant (true Israel) included believers such as Simeon and Anna (Luke 2:25–38). During Jesus’ adult ministry, true Israel was most visible in those Jewish disciples who believed that Jesus was the Messiah. Those who rejected Jesus were not true Israel, regardless of their race. This included many of the scribes and Pharisees. Though they were physically Jews, they were not true Israel (Rom. 2:28–29). True Israel became def ined by union with the true Israelite—Jesus Christ (Gal. 3:16, 29).

On the day of Pentecost, the true Israel, Jewish believers in Jesus, was taken by the Holy Spirit and formed into the nucleus of the New Testament church (Acts 2). The Holy Spirit was poured out on the true Israel, and the same men and women who were part of this true Israel were now the true new covenant church. Soon after, gentiles began to become a part of this small group.

This is an extremely important point to grasp because it explains why there is so much confusion regarding the relationship between the church and Israel. The answer depends on whether we are talking about national Israel or true Israel. The church is distinct from national Israel, just as the true Israel in the Old Testament was distinct from national Israel even while being part of national Israel. The remnant group was part of the whole but could also be distinguished from the whole by its faith.

However, if we are talking about true Israel, there really is no distinction. The true Israel of the Old Testament became the nucleus of the true church on the day of Pentecost. Here the analogy of the olive tree that Paul uses in Romans 11 is instructive. The tree represents the covenant people of God—Israel. Paul compares unbelieving Israel to branches that have been broken off from the olive tree (Rom. 11:17a). Believing gentiles are compared to branches from a wild olive tree that have been grafted in to the cultivated olive tree (Rom. 11:17b–19). The important point to notice is that God does not cut the old tree down and plant a new one (replacement theology). Neither does God plant a second new tree alongside the old tree and then graft branches from the old tree into the new tree (traditional dispensationalism). Instead, the same tree exists across the divide between Old and New Testaments. That which remains after the dead branches are removed is the true Israel. Gentile believers are now grafted into this already existing old tree (true Israel/the true church). There is only one good olive tree, and the same olive tree exists across the covenantal divide.

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