This research aims to analyze the implementation of customary law within the Indonesian national legal system and to examine the integration of local values and Islamic law in the formation and application of law in Indonesia. This study is motivated by the importance of recognizing legal pluralism amid the dominance of a national legal system that tends to be formalistic and centralized. The research employs a normative juridical approach using a library research method through the analysis of legislation, legal doctrines, scientific journals, and various literatures related to customary law, Islamic law, and the national legal system. Data analysis techniques were conducted descriptively and analytically using conceptual and legal interpretation approaches. The results of the study indicate that customary law holds an important position as a living law that continues to exist and develop within society and has obtained constitutional legitimacy within Indonesia’s national legal system. The integration of local values and Islamic law can be observed in various social practices of indigenous communities in Indonesia, where custom and religion complement one another in creating social order and justice. However, the implementation of customary law still faces several challenges, including the dominance of state law, weak recognition of indigenous peoples, and the influence of globalization and modernization. This research recommends harmonization between state law, customary law, and Islamic law through strengthening the recognition of indigenous legal communities, revitalizing local cultural values, and developing a more inclusive, contextual, and socially just national legal system..