Negative psychological effects of the coronavirus disease (COVID-19) have been identified in adults and children, such as anxiety and sleep disorders. However, research about the impact of this pandemic on children from ethnical minorities is scarce. We tested the effects of COVID-19 outbreak on psychological aspects and daily routines among Arab Israeli Children. An online cross-sectional survey was conducted among Arab Israeli parents, including behavioral and emotional aspects questionnaire and questions addressing using of screens, sleep, and physical activities. The results showed that, during the COVID-19 outbreak, 55.8% of the children asked to sleep in their parents’ bed and 45% expressed fears they did not have before. Most of the children showed increased irritability, constant mood swings and nervousness about limits and messages, and 41.4% showed sleep difficulties. Concerning adaptive behaviors, more than 50% of the parents reported that their child became wiser, lazier, and was able to adapt the limits and restriction of the COVID-19 outbreak. Moreover, the children tended to increase their use of screens, used to sleep more time, and were less active physically. The results suggest that children are vulnerable to the COVID-19 outbreak psychological effects and highlight the need to reduce the psychological burden of this pandemic and the necessity of immediate intervention.