A lot has been said about a two state solution in the Israeli-Palestinian conflict but that does not seem likely or realistic. Israel will never agree to a two state solution because it is the de facto ruler of 100% of the land in question whether or not people wish to recognize that. No country has ever willingly signed over half of its land, and is probably never going to happen.
However, the situation has to be rectified. Many compare Israel to Apartheid South Africa or the Jim Crow South, but Nelson Mandela never asked for South Africa to be split into a white and a black side, each with its own government, he strived for a better together South Africa.
This brings me to the idea of a Bosnian Solution, if your not familiar with the government of Bosnia and Herzegovina here is a break down
1) the country is Federalized with Bosnians being a majority in one state and Serbs in the other
2) there are two houses in the legislative branch one has equal representation of each ethnic group (Croats, Serbs, Bosnians) the other is popularly elected.
3) a 3 member presidency (Croat, Serb, Bosnian)
Now this needs some tweaking to fit Israel, With Israeli, Arab, Palestinian ethnic groups replacing Croat, Serb, Bosnian.
The Bosnian government is far from perfect, but they don't devolve into civil war every few years.