Like American and Canadian cultures, Israeli culture incorporates a "blending;" however, I might say that it is more unified (on a daily basis) than its Western counterparts.
However, there is no uniform culture in Israel. Israeli culture is a diverse mix of secular Jews, semi-religious Jews, Charedim (ultra-orthodox), Ashkenazis, Mizrachis, Christian Arab Israelis, Muslim Arab Israelis, and people who identify as Palestinians (same culture as Muslim Arab Israelis). Depending on your geographical location, you might experience many different cultures. For example:
If you are in Mea Shaarim (Charedi Jerusalem neighborhood), you will find that the culture is extremely religious and conservative. The atmosphere is quieter, and a strict dress code is enforced by the residents-- on all who even walk through the neighborhood on their way to somewhere else. Mixed groups are discouraged, inappropriate clothing is forbidden, and there are even signs stating that non-Charedi women are forbidden from walking through Mea Shaarim while they are menstruating.
If you are in Haifa, you will find a diverse blending of cultures, because this is where Muslims and Jews coexist the best. The beach influences the culture: beautiful mediterranean air, a laid-back culture, and beautiful sights.
If you are in Jerusalem (not mea shaarim), you will find the most thrilling blend. The food is obviously predominantly Middle Eastern, but there are many restaurants reflecting immigrants of varying nationalities: Persian food, Russian food, Armenian food, etc. The old city has 4 quarters, Jewish, Arab, Armenian and Christian, and the city is a rush of excitement. Life moves quickly, and I would describe the cultural attitude as one of appreciation for life. People jump around dancing like fools, enjoying being alive and feeling the movement of their bodies. They are not self-conscious because they know that life is temporary. They are not morbid; rather, they celebrate and live every moment alive.
It is difficult to describe what makes Israel different from other middle eastern countries, because i have not spent so much time in any of the other countries. However, I would say that with the exception of the Charedim, it is more liberal-- people dancing, holding hands, dressing a bit more western(esp. in Tel Aviv!! There is more of an accepted gay culture.)
Israelis feel so much compassion for one another. It is a popular expression that the first Israeli was a cactus- prickly on the outside, sweet on the inside. This is true. On a bus, a stranger may point out that your sweater is unflattering, but if you need help, the same stranger will risk their life for you, invite you to their home, and help you with whatever you need.