Witnesses watched in horror as the civilian helicopter spun out of control and splashed into the ocean.
Police spokesman Micky Rosenfeld said the helicopter crashed about 300 metres from the seaside city of Netanya this afternoon.
All four people on board, including the pilot, were killed.
He said one passenger was a British tourist and the others were Israelis.
The British tourist has not been identified. The Jerusalem Post has reported that it was a male in his 40s.
Israeli newspaper Haaretz identified the pilot as Ran Iapid, who worked for El Al. One of the other casualties was named locally as Yoav Tamir, a co-owner of Tamir Airways.