The present work attempts to describe prejudice and terrorism in interreligious context in Indonesia. It discusses two issues which divided into 2 specific themes. Theme 1 discusses the phenomenon of the emergence of religious fundamentalism and terrorism. Theme 2 discusses the causal process of prejudice and its expression in interreligious relations. Theme 1 is discussed in two chapters discussing findings from different research: section 1 investigates motives and reasons behind the emergence of terrorism activities in Indonesia; section 2 focuses to understand when and how act of terrorism is supported and denounced by Islamic fundamentalists in Indonesia. Theme 2 consists of three chapters, introducing the idea of ingroup metaprejudice (the way of how group members think that their own group think about an outgroup) and outgroup meta-prejudice (the way how an ingroup member thinks that his or her ingroup is viewed by outgroup members). Across three sections showing findings on the relationship between meta-prejudice and prejudice, how group members think of what others are thinking considered to play a key role in influencing intergroup relations and perceptions.