The 1940 Palestine Cup (Hebrew: הגביע הארץ-ישראלי, HaGavia HaEretz-Israeli) was the eleventh season of Israeli Football Association's nationwide football cup competition. The defending holders, Hapoel Tel Aviv, fell to city rival Maccabi Tel Aviv at the semi-final. Maccabi met the emerging team of Beitar Tel Aviv at the final and lost 1–3.