The Sea of Galilee has great significance as a natural habitat and a freshwater source for Israel. Anthropogenic impacts have been placing significant pressure on the species inhabiting this lake, among which is Sarotherodon galilaeus, an omnivorous fish with a relatively large population and significance for commercial fishing. An alarming decline in annual catch towards 2008 suggested that this unique population might be at risk. With that in mind, we characterized the current genetic variation of this species in Israel with reference to fish from Ghana, based on D-loop and microsatellite markers. Genetic variation and differentiation were found mostly among fish from Ghanaian localities and between fish from Israel and Ghana, whereas fish from all Israeli localities had uniform and limited variation, a signature compatible with historical founder effect followed by local adaptations. Such historical processes could leave a population vulnerable as reflected in the sudden and recent population decline. Comparing genetic variation between archived 30 year-old scales and modern lake fish revealed further reduction in genetic variation coincident with the recent population decline. Thus, a recently occurring genetic bottleneck had placed this unique and isolated population at an even higher risk. We carefully discuss the events leading to the current risk status for S. galilaeus in Israel and highlight the need for vigilant monitoring and active management to support a more sustainable future for this and other fish communities in this important habitat.