However, Israel does have highly theocratic tendencies. Their constitution places Jewish identity on the same level as their democratic statute. They have even more religious influence on public life than the USA does (which is already somewhat high by European standards), with businesses in many cities being boycotted into respecting the Sabbath and other religious holidays (not selling risen bread during Passover, making elevators stop automatically on every floor during days of rest, observing kosher restrictions on food etc). Many of their foreign policy decisions are explicitly influenced by religious tenets, such as believing they were gifted the "land of Israel" by their god (which includes modern day Israel, the Occupied Territories, and several parts of modern day Syria, Lebanon, and others).
They're nowhere near the level of religous rule and/or fanaticism as Saudi Arabia, but they have much more religious influence and control of public life then a modern European/US-style democracy.