The party supports creation of two states based on pre-1967 borders, with the West Bank, Gaza Strip, and East Jerusalem to constitute a Palestinian state and the implementation of UN Resolution 194 regarding the right of return to Palestinian refugees.
Balad describes itself as a 'democratic progressive national party for the Palestinian citizens of Israel.'
Since its creation, it has objected to every proposed state budget submitted on the grounds that it discriminates against the Arab population.
In 2002 party leader Azmi Bishara was indicted on the grounds that he "knowingly assisted Israeli citizens to enter Syria without approval of the Minister of Interior" and for speeches "made at two different gatherings that were reported by the media, one in Umm al-Fahm marking the passage of 33 years since the Six-Day War, and the other in Kardaha, Syria, marking the first anniversary of the death of Syria’s President, Hafez al-Assad" praising Hezbollah. The trial was however cancelled, after The High Court of Justice ruled in favor of a petition submitted by Bishara where he protested that his speeches were protected by legal immunity, which is granted to all Knesset members in order to allow them to fulfill their duties. His parliamentary immunity was immediately restored.
Prior to the 2003 elections, the Central Elections Committee banned the party from running by a one-vote margin, claiming it did not respect Israel's legally-mandated status as a Jewish state and that its leader supported terrorism. The move to ban Balad was initiated by Michael Kleiner, the leader of the right-wing Herut party, who alleged that Balad was "a cover-up for illegal activity" and that it "supports terror organizations, identifies with the enemy and acts against Israel as a Jewish and democratic state. The Gush Shalom activist group criticized the decision saying it introduced into the committee the 'aggressive, predatory and racist attitudes of the majority of the extreme right' who they believe favor banning all Arab MKs. Bishara personally responded to the Election Committee's charges that he supported Hezbollah by saying, "I believe that a people living under occupation [have] the right to fight against it, but I never called on the Palestinians to embark on an armed struggle against Israel. I never supported violent activity." The Elections Committee had also voted to ban Ahmad Tibi of the Ta'al party who had formed an electoral alliance with the left wing Hadash coalition..
However, the bans on both parties were overturned by the Israeli Supreme Court. Supreme Court Justice Misha'el Kheshin told the election committee that Bishara's past expressions of support for Hezbollah in Lebanon had angered him, although he voted to allow him to run in the elections because "Israel's democracy is strong and can tolerate irregular cases", and thought that there was insufficient evidence for the ban. Balad won three seats in the elections, filled by Bishara, Wasil Taha, and Jamal Zahalka.
In the 2006 elections Balad won three seats, which were taken by Bishara, Taha, and Zahalka. However, more controversy was to come when all three visited Syria in September 2006. They returned to Israel on 16 September, saying they plan to return to Syria again "if necessary." A police investigation will be opened against them as well. Member of Knesset Azmi Bishara, head of the Balad party, told: "Israel won't tell us with which Arabs we can forge ties.
On April 22, 2007, Bishara resigned from the Knesset via the Israeli Embassy in Cairo following a police investigation into his alleged assistance of Lebanon during its war against Israel, and various other criminal charges including money laundering. He was said to be "considering staying abroad because he feared a long term jail sentence and an end to his political career. Bishara was replaced in the Knesset by Said Nafa.