EURO is an international football (soccer) tournament in which European countries participate. Technically, the eligibility for participation depends on whether a country is part of the European football confedaration or not. The European confederation is called UEFA.
Somehow Israel is participating in this tournament. Israel also participates in Eurovision (along with other guests like Australia). Seems like the criteria for being European is whiteness lmao.
Also Russia has been banned from participating in EURO 2024.
IIRC Israel and Israeli teams could also compete in AFCON and CAF (African equivalents of Euro's and Champions League) but they'd have to face Arab countries and you can guess how that would go. Imagine Beitar Jerusalem fans having to go on an awayday to Raja Casablanca lol. People would die.
Edit: my bad, it's in the Asia Cup actually. But still, Israel vs Iran would not be the most friendly fixture.
You're confusing the fact that Isr*el was an observer state in the African union but got suspended because the "the AU is being taken hostage by a small number of extremist states like Algeria and South Africa, which are driven by hatred and controlled by Iran” - Sharon Bar-li