"Family values" have become part of right-wing populist discourse and agenda, defending against what is described as an encroachment of the traditional family. The traditional family, perceived essential to moral order, political stability and economic well-being is to be defended against liberal ideas that support freedom of choice and the right to non-traditional families and lifestyles. These demands, however, face a reality of growing secularization reflected, among other things, in support for LGBTQ or growing rates of divorce, also among supporters of right-wing populism. In Israel, as this paper demonstrates, this contradiction produces an odd form of liberalism. On the one hand, growing tolerance towards non-traditional families among the (Jewish) in-group, and on the other hand, intolerance towards out-groups (Arab citizens or asylum-seekers). While this development appears to divide the right-wing populist camp it also challenges traditional concepts of universal liberalism.