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ABSTRACT Alam and Husband explore the ways in which two policies of central government, in both conception and expression, have operated in such a way as to promote the growth of Islamophobia in Britain. Policies of community cohesion developed in response to the riots in northern British cities in 2001, while the counter-terrorist polices that emerged following the bombings on mainland Britain in 2005 were targeted at Britain's Muslim populations. The rhetoric employed in the public sphere to legitimate these policies had the effect of making Islamic identity salient, and aberrant, in the context of twenty-first-century Britain. The scapegoating of Muslims, as essentially an alien wedge in British society with a deep resistance to entering into ‘the British way of life’, was attached to an interpretation of their demographic location in British cities so as to present them as both ‘self-segregating’ and ‘living parallel lives’. The emergence of ‘home-grown bombers’ resulted in the state maintaining a sense of risk to terrorist assault that fed off and into the existing securitization of urban life, consolidating a policy environment defined by the sense of an essentially permanent state of crisis. These exceptional circumstances permitted a suspension of previously sacrosanct principles of human rights and freedoms. The empirical evidence underpinning this paper reinforces the notion that these policies were mutually contradictory in practice, and that the penetration of social cohesion initiatives by the logics of surveillance resulted in a breakdown of trust between large sections of the British Muslim population and the agents of the state.