The relationship between religion and culture is a fundamental aspect in understanding the dynamics of religious life among Muslim communities, particularly in the Indonesian context, which is marked by ethnic diversity, local traditions, and indigenous value systems. Islam, as a religion that carries universal principles, emerges and develops through a dialogical interaction with local cultures, resulting in diverse expressions of Islamic practice. This article analyzes the major theories explaining the relationship between religion and culture, including the theory of Islamic universality and cultural particularity, acculturation, assimilation, hybridity, the anthropology of religion, and postcolonial perspectives, and examines their relevance to the development of contemporary Islamic education. The study employs a qualitative approach based on literature review, drawing from classical works and recent findings in reputable journals. The research findings indicate that the relationship between Islam and culture is not a binary opposition but rather interactive, adaptive, and creative. This interaction produces contextual religious practices without diminishing the core values of Islam. The relevance for Islamic education is evident in three main aspects: first, the need for a culturally responsive Islamic education curriculum; second, the integration of local values as a medium for internalizing Islamic teachings; and third, strengthening the paradigm of religious moderation through historical and anthropological understanding of Islamic practices in society. The novelty of this study lies in its comprehensive synthesis of theories on religion–culture relations and their practical implications for the development of Islamic education, an approach rarely explored in depth in previous studies. This research contributes to the argument that Islamic education can develop in a relevant and inclusive manner only by viewing culture as a dialogical partner, not as a threat to the purity of religious teachings. Thus, this article provides a theoretical and conceptual foundation for developing Islamic education that is moderate, contextual, and rooted in local wisdom.