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Last year was a mixed one for Israeli cinema: Although "Waltz with Bashir" won the Golden Globe award for best foreign film last week and is a strong candidate for an Oscar in the same category, fewer moviegoers in Israel saw locally-produced films in 2008 than in the previous year.

Approximately 760,000 people went to theaters to see Israeli movies in 2008, compared to 1.25 million in 2007. Still, the numbers may not reflect a fundamental change in viewers' tastes for Israeli movies. Critics point out that 2007 was an exceptionally good year for the Israeli film industry, with a number of high-grossing films such as "Beaufort," "Noodle," "The Band's Visit" and "The Secrets" boosting box-office numbers. In 2006 only 874,000 filmgoers in Israel visited cinemas to see Israeli movies in 2006, while in 2005 that number was just 340,00.

Two movies this stood out in terms of their box-office appeal tickets grossed the past year: "Lost Islands," a drama about a family in Kfar Sava during the 1980s; and "Seven Days," locally released as "Shiva," a critically acclaimed film starring Ronit Elkabetz, who co-wrote the screenplay with her brother Shlomi Elkabetz. Each movie drew some 200,000 moviegoers.

"Waltz with Bashir," the movie which has won the most international acclaim this year, was seen by only 100,000 people in Israel. However, that number can be considered a huge success given the limited number of cinemas that screened it, the difficult subject matter of the first Lebanon War and its unusual genre - animated documentary. It has grossed more than $7 million dollars abroad and is on the short list for the nominations in the Best Foreign Film category of the Academy Awards, which will be announced on Tuesday. Yesterday "Waltz" made the short list in two categories for the British Academy of Film and Television Arts Bafta awards - best film in a foreign language and best animated movie. Another Israeli movie dealing with the Israeli-Arab conflict succeeded on the international arena in 2008: "Lemon Tree," a drama following the lives of an Israeli and a Palestinian woman, was seen by over 600,000 people in France, the U.S., Spain and Brazil but drew only 20,000 viewers in Israel.

First-run international screenings of last year's big Israeli hit, "The Band's Visit," ended only recently. The film grossed $14.5 million, making it Israel's second most commercially successful movie.

Despite these recent successes, the state budget for supporting the local film industry in 2009 and succeeding years has still not been approved. Filmmakers fear a decline in film quality if the state support is not secured.