The dynamic of global conflicts arising from terrorism is not only posing a big challenge to human existence, but also implies a clash between two hegemonies i.e. the hegemony of “Islamic Fundamentalism” and the hegemony of “Market Fundamentalism”. This paper examines the genesis of Modern Islamic revivalism and its challenge to Western civilization. Contrary to the assumption that terrorism is mainly associated with Islam, the paper argues that terrorism is a by-product of globalization with Market liberalization and its inherent contradictions, spearheaded by the United States and her allies, represented by western values and capitalist expansionism. This liberalization or Market hegemonic policy brought about economic and political inequalities on a global scale. Therefore, modern Islamic revivalism is not a terrorist idea, but a reaction against economic exploitation that plagues the world. The paper further argues that a fight against terrorism must go beyond improving security around cities, but also embrace rooting out the remote and immediate causes of this dangerous phenomenon.