The statement condemned "the shameful agreement and humiliating act", and termed it as a strategic stupidity and a great betrayal.
""The history will never forget this heinous move taken by Bahrain," it added.
It pointed out that after accepting humiliation by the United Arab Emirates (UAE), now accepting the humiliation of compromise by Bahraini government in diverting the world's public opinion from the first issue of the Islamic world and normalizing relations with the child-killing Israeli regime is a clear betrayal that will never diminish the determination and resistance of nations of the Islamic world.
"With this humiliating compromise, Bahraini rulers should know that allowing Zionist regime to step its foot in the Persian Gulf region will not be a simple issue and not only this irrational act will not lead to the spread of peace and security but also will lead to growing insecurity and instability in the region," the statement added.
It said that the foolish rulers, who are in a hurry to normalize relations with the occupying regime of Israel, will one day pay a heavy price for this great crime.
"In continuation of their struggle in supporting the Palestinian cause, the brave nation of Bahrain will undoubtedly respond to this betrayal of the dictatorial rulers," the Islamic Development Organization added.
US President Donald Trump tweeted the news of the Israel-Bahrain normalization deal on Friday after he spoke by phone to Bahrain's King Hamad bin Isa Al Khalifa and Israeli Prime Minister Benjamin Netanyahu.
Following the announcement at the White House, Palestinian officials condemned the Israel-Bahrain normalization deal announced by US President Donald Trump as another "stab in the back" by an Arab state.
Friday's accord normalizing diplomatic ties between Israel and Bahrain comes one month after the United Arab Emirates (UAE) agreed to normalize ties with Israel under a US-brokered deal.
On August 13, President Trump announced a deal brokered by his government between Israel and the UAE which he said would lead to full normalization of ties between the two.
Critics see the deal as the latest attempt by Trump to save his presidential campaign against the Democrat Joe Biden.
Bahrain's main opposition group, the al-Wefaq National Islamic Society, in a statement condemned a deal between Israel and Bahrain as an “ultimate betrayal of Islam and Arabs and a departure from the Islamic, Arab and national consensus".
It also said that the Israel-Bahrain agreement is void of any legitimacy whatsoever.
“Bahraini people, with all their religious, political, intellectual and societal differences, are unanimous in adhering to Palestine and rejecting the entire Zionist entity and standing with Palestine until the last piece of land is liberated from it,” the group added.
Al-Wefaq concluded that normalization with Israel is “a blatant contradiction to the will of the Bahraini people and a coup against their principled creed in rejecting the occupation of Palestine”.
The Iranian foreign ministry also in a statement strongly condemned the normalization of relations between Bahrain and Israel, and said that it is a shameful and humiliating act by the Manama government.
"Undoubtedly, the oppressed and right-seeking people of Palestine and the freedom-seeking Muslims of the world will never accept the normalization of relations with the usurper regime of Israel, and this shameful act will forever remain in the historical memory of the oppressed nation of Palestine and the freedom-seeking nations of the world," the statement read.
The Iranian foreign ministry pointed out that instead of gaining legitimacy from its people, the Bahraini government, in a fundamental mistake, has established diplomatic relations with the Zionist regime and sacrificed the Palestinian cause for the US internal elections.
"The rulers of Bahrain will henceforth be complicit in the crimes of the Zionist regime as a source of the constant threat to security in the region and the Islamic world and the root of decades of violence, killing, war, assassination, and bloodshed in Palestine and the region," the statement reiterated.
It added that certainly, the result of this action of the Bahraini government will only cause the growing anger and lasting hatred of the oppressed people of Palestine, the Muslims, and the free nations of the world.
"The responsibility for all the consequences of this action lies with the Bahraini government and other accompanying governments," the statement further said.