Answer:
By partitioning it into two states, one Jewish, one Arab.
Further details:
After the Second World War II ended in 1945, the United Nations (UN) adopted a plan for the partition of Palestine that would create a portion of that territory as the state of Israel, with the other part as an independent state for Palestinian Arabs. The Arabs in the region and surrounding Arab nations were not in favor of this, because they opposed the creation of a Jewish state in their region.
As the British were ending their mandate governance of the region in May, 1948, the Jewish leaders in the land proclaimed their independence as a nation. A war with Arab peoples and nations in the region followed. Israel won that war and established itself as a nation. Over 700,000 Palestinians fled their homes and land and have not been able to regain independent rights to their territory.
The new state of Israel was granted membership in the UN in 1949. Israel won a series of wars (in 1967, 1973 and beyond) over against Arab states in the region. Palestinians have made efforts against Israeli control, notably with movements called "Intifadas," in 1987 and 2000. They have not been able to achieve nationhood status, however.
