This study aims to identify the reality of FDI in Arab countries and analyze the relationship between FDI and foreign trade in Arab countries during the period 2000-2018. Statistical analysis tools such as the correlation coefficient and ANOVA analysis were used to test the significance of the linear regression between the variables, to analyze the relationship between FDI (independent variable) and all of the Arab exports and imports, trade balance, and Arab foreign trade (dependent variable). Despite the rapid liberalization programs of investment systems and the trend towards privatization and liberalization of economic activity and joining the WTO (hence, WTO), and other measures, the flow of foreign investments to Arab countries continues. Only three countries (UAE-Egypt-Oman) accounted for 68.5% of the total FDI coming to Arab countries in 2018. This indicates the weakness of many other Arab countries in attracting FDI. Results showed that the European Union is the leading trading partner of the Arab countries. The UAE and France topped the countries investing in the Arab countries. The statistical analysis results showed that the correlation between FDI (as an independent variable) and Arab foreign trade (as a dependent variable) is a positive, medium-strength. They also proved that (17.8%) of Arab foreign trade could be explained using FDI, while the remaining percentage is attributed to other variables.