This article is grounded in the polarization between traditionalist and modernist models in the Islamic Religious Education (PAI) curriculum, which has produced epistemological fragmentation in the development of Nusantara Islamic education theory. This study aims to analyze the strengths and weaknesses of the traditionalist model, examine the strengths and weaknesses of the modernist model and explain Islam Wasathiyyah as an epistemological foundation. This research employed a qualitative approach through critical library research, supported by Norman Fairclough’s critical discourse analysis. The data were collected from policy documents, curriculum regulations, and relevant scholarly articles. The findings show that the traditionalist model is strong in authoritative knowledge transmission, moral formation, spirituality, and moderate character building, yet weak in adapting to modernity and contemporary sciences. In contrast, the modernist model is strong in educational access, competitiveness, and knowledge integration, but it risks eroding Islamic identity and producing hidden secularization. Islam Wasathiyyah offers an epistemological synthesis through the principles of tawassuth, tawazun, tasamuh, and i’tidal, which can integrate the strengths of both models while overcoming their limitations. The implication of this study emphasizes the need to develop a holistic, transformative, and contextual PAI curriculum rooted in the character of Nusantara Islam.