Later the capital moved to Jerusalem and Ramle lost its political importance while remaining a major town. Its economic importance, shared with its near-neighbor Lydda, was based on its location at the intersection of Palestine's two major roads, one linking Egypt with Syria and the other linking Jerusalem with the coast.

During the 1948 Arab-Israeli War, Ramle's geographical location (especially its position on the main supply route to the Jerusalem region) made it an inevitable point of conflict, and it was attacked by Jewish forces beginning in May. These initial attacks were unsuccessful, but a more determined attack during Operation Danny led to Ramle's capture on July 11-12, 1948. Most residents of the town who had not fled already were forcibly expelled on Ben-Gurion's orders. The only inhabitants who remained after the town's capture were about 400 Arabs, who were mostly either Christian or had had prior dealings with Jews.

The Israeli government immediately saw the nearly depopulated town as a source of housing for the many Jewish immigrants who were beginning to arrive, and started to use the abandoned houses for this purpose in November 1948. By February 1949 the Jewish population had passed 6,000. Nevertheless, Ramle and Lydda (now called Ramla and Lod) remained relatively economically depressed for the next two decades. The population in 1972 was 34,000.