Islam is no more a pure foreign policy matter for Europe, but it is evolved into a matter of domestic politics for the European countries. Muslim communities are developing in Europe and Islam is the second largest religion in most of European countries. In future, Muslims will be an influential social and political force within the European Union and will enjoy direct influence in decision making process of domestic and foreign policy of Europe. Meanwhile, the role of Muslims in Europe faces different challenges like keeping religious identity, direction and cohesive political structure, political legitimacy, inappropriate social and economic condition and containment policies implemented by European countries.