[5] The built-up area of two Muslim Arab villages, Kafr 'Ana in the east[6] and Saqiya[7] to the west, are located within the current Or Yehuda city limits.

[11] In the end of April 1948, the Haganah launched military operation Hametz, which aimed to conquer several villages inland from Jaffa to isolate it from the Arab hinterland.

[12] In 1949, immigrants from Libya and Turkey settled in the ruins buildings[dubious – discuss] of the villages of Saqiya and Kafr 'Ana, which did not have water or sewage infrastructure.

[citation needed] The modern town of Or Yehuda was officially established by the State of Israel in 1955 and was named after Judah Alkalai.

Babylon Ltd., a developer of online translation programs that holds the Guinness World Record for the highest number of downloads of a language solution software, is based in Or Yehuda.

In 1982, Or Yehuda was one of the first few cities to take part in the Program for Talented Youth in Mathematics, established by Professor Zvi Arad and Bernark Pinchuk, at Bar-Ilan University.

Among the high-school students of Or Yehuda participating in this program was Boaz Tsaban, who proceeded to win national prizes for his achievements, and is now a Professor of mathematics at Bar-Ilan University.

The Babylonian Jewry Heritage Center, a museum documenting the history of the Iraqi Jewish community, was established in Or Yehuda in 1988.