This article attempts to document and examine the corpus of Arabic and Islamic allusions and references in Shakespeare's drama and poetry in line with postcolonial discourse and theory. The works of Shakespeare incorporate a large body of Arabic/Islamic matters, which the Bard has gleaned from different sources, such as travel literature, narratives of pilgrims, history annals and common tales of the Crusaders. However, these matters are sporadic in Shakespeare's works, woven into the fabric of various plays and poems. For example, Shakespeare has thematically used a set of allusions and references to the Arab world such as Arabian trees, the Prophet Mohammed, the Turk, Aleppo, Jerusalem, and many others. Shakespeare has also presented three Oriental characters in his plays: the Prince of Morocco, Shylock and Othello, each with distinctive ethnic and personal traits. A scrutiny of Arabic and Islamic matters in the works of Shakespeare from postcolonial critical perspectives reveals that Shakespeare has a vague idea about Arabs and the Orient at large. Therefore, Shakespeare represents the Orient as the other; his Orient is rather exotic and bizarre, posing as an impending menace to Europe.