'It's not mission impossible to make an Israeli movie and show it all," says Eytan Fox, the director of Yossi & Jagger and Walk on Water, about his latest film, The Bubble, which just opened in theaters throughout Israel. The Bubble tells the story of a group of friends in Tel Aviv whose lives become complicated when one of them gets romantically involved with a young Palestinian. Discussing The Bubble over a glass of wine at the Paradiso Cafe in Jerusalem, Fox acknowledged the difficulties of making a film that mixes comedy and romance set in "the bubble" - the chic, insulated world of Tel Aviv's Sheinkin Street cafes - with a serious look at the Israeli-Palestinian conflict. "With movies here, there's usually a dichotomy. Either you make a funky urban comedy... or you make a very serious movie about the occupation," he says. But the Tel Aviv-based filmmaker, who was born in New York and raised in Jerusalem, decided to make a movie that mirrored his own life and the lives of his friends. He describes his daily routine of opening the newspaper and reading about violent clashes between Jews and Arabs not far from where he lives, then turning to the food column and "seeing a recipe for some fancy-shmancy thing with mangoes that I want to do and I read about a restaurant I want to go to and then about a movie. And this combination is what I wanted to show, which is fascinating and crazy and almost perverted. You know, people who come from abroad sometimes see the life in Tel Aviv and they say, 'It's so strange here, everything seems so normal.'" It's a contrast that is so much of a given that most Israelis rarely discuss it, just as Fox and I do not mention that in order to enter this caf , where tunes from Broadway musicals play in the background, we both had our briefcases examined for explosives by an armed guard. He recalls attending a screening of his first feature film, Song of the Siren, that Jerusalem Cinematheque director Lia van Leer organized for representatives of Hadassah in the mid-'90s. Song of the Siren, an adaptation of the Irit Linur novel, took a humorous look at the love life of a female Tel Aviv advertising executive during the first Gulf War. "I remember that some of them [the Hadassah women] really got upset in the screening and said, 'Is this how you present the Israeli-Jewish woman, caring only about shopping?' and stuff like that. I thought, 'Okay, whatever, it's funny,' but Lia was saying, 'What are you talking about? We have our lives, we have to maintain some kind of normality, we do just live and we do have families and love affairs and we do shop and enjoy shopping.' "So I've been there, I've been there with Song of the Siren, which is more an escapist Tel Avivian romantic comedy, and I've done things that were more serious, like Yossi & Jagger, and to some extent, Walk on Water. And then you say, 'I want to combine both.' "It was difficult for some funds [film funds, organizations that provide financing for filmmakers here] to understand what I was trying to do. They would say, 'How are you going to combine both?'" continues Fox, referring to an affectionate look at Tel Aviv and the Arab-Israeli conflict. "And I would say, 'That's just the point, that's the movie.' And eventually they did get it." IN SPITE OF his initial difficulty gaining support from some of the local film funds, on the whole, "it was easier to come to these funds and say I want to make a movie this time," after the financial and critical success of Walk on Water, the story of a Mossad agent (played by Lior Ashkenazi, who has a cameo in The Bubble) assigned to guard the grandson of a notorious Nazi. Eventually, the Mossad agent finds that his perspective is changed by the friendship that develops between him and the young, gay German man and the German's sister. Walk on Water opened the prestigious Panorama section at the Berlin Film Festival in 2004, a first for an Israeli movie. In spite of its apparently uncommercial subject matter, Walk on Water went on to make more money worldwide than any Israeli movie in history, more than $7 million. Fox, 41, who first became famous as the director of the television show Florentine, about 20-somethings in South Tel Aviv, has made a name for himself chronicling life both inside and outside "the bubble." In Florentine, Fox, who is homosexual, pushed the boundaries of what was acceptable on Israeli television with a storyline that featured a kiss between two male characters. He co-wrote The Bubble with Gal Uchovsky, his personal and professional partner for the past 18 years. Fox's films often deal with the problems of gays in Israel, such as the love affair between two male IDF soldiers in Yossi & Jagger. Although initially intended as a television drama, the film was shown in Israeli theaters and attracted such a following that eventually it was distributed overseas. In 2003, Yossi & Jagger star Ohad Knoller (who also appears in The Bubble) won the Best Actor Prize at the Tribeca Film Festival in New York. "I made The Bubble relatively fast after Walk on Water," Fox says. Although there is a subplot in Walk on Water involving an Arab character (played by Yousef "Joe" Sweid, who also plays the pivotal character of Ashraf, the Palestinian lover, in The Bubble), Fox decided that this time, he wanted to confront the Israeli-Palestinian conflict "head-on." He credits his awareness of the conflict and his ability to dramatize it both here and abroad to his American mother, who died while he was making Walk on Water. "Walk on Water was dedicated to my mother," he says. She was also the inspiration for the character of Noam's mother in The Bubble, who appears in flashbacks. Like Fox's mother, Noam's mother is a community activist in Jerusalem's French Hill neighborhood and organizes a protest when a sign is posted in the local playground saying that Arab children are not welcome there. After his mother's death, Fox and his siblings visited Isawiya, the Arab village just a few minutes' walk from French Hill, and started a project in their mother's name to improve living conditions there. Fox became fascinated by the lack of contact between the residents of French Hill and Isawiya villagers and thought, "This is going to be my next movie," he recalls. He chose not to set the film in Jerusalem, though, because, "I live in Tel Aviv and I really have very little to do with the conflict and fighting for Palestinians. In my movies I try to deal with all kinds of issues that relate to [the conflict] but then again, I have my very pampered life in Tel Aviv... I didn't want to be a hypocrite." Several extended sequences in the film take place in Nablus and were filmed in an Arab village. Fox says that actor Yousef Sweid, "helped a lot" by explaining what aspects of the script might antagonize local residents. Fox finds comfort in the fact that Sweid, who appears on the Israeli television soap opera, Ha'alufa, has become a teen idol. "Girls love him," he says. "There just wouldn't have been an Arab teen idol when I was a kid." In spite of some of the more tragic plot turns in The Bubble, Fox is gratified that, "A few people have told me, 'The film gives you some kind of hope,'" he says, just before he hops into his car to face the traffic on the Jerusalem-Tel Aviv highway.