The research aims at (a) describing the strategies and identifying the levels of refusal speech act in politeness and (b) formulating the internalization of polite values in a process of the Javanese culture-based students" character building. It was conducted at Darul Ihsan Muhammadiyah Islamic Boarding School Sragen, Central Java, Indonesia. It employed a descriptive and qualitative, and analytic, critic, and holistic approach. The data sources covered all the students (santri) and teachers (asatidz) in both formal and informal situations. The objects were the refusal speech acts, spoken in the communication at the school. The data were collected with the techniques of content analysis, in-depth interview, and observation. These were analyzed with a contextual-extralingual method. In conclusion, the results of the research show that: (a) the refusal speech act is performed through the indirect (63%) and direct strategies (37%), (b) the refusal speech act is spoken through indirect communication in politeness (29%), impoliteness (56%), disadvantage-benefit (3%), authority (5%), and option (5%), and social distance (2%), and (c) the internalization of the students" character building is performed in the forms of role model, habit, supervision, advice and suggestion, warning, and sanction. The dominant factors in the internalization process are closely related to the teachers" roles, Islamic Boarding School"s circumstance, and politeness building in the learning process. The problems are closely related to the low understanding of politeness, heterogeneous students, and their habits.