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The last decade witnessed a dramatic surge in state terror and nonstate terrorism in Egypt. Against this backdrop, this article investigates how the al-Sisi regime engages in a particular form of terrorism racketeering aimed at generating continued external resources as well as political and military support required for the (re)building of a highly authoritarian order. This analysis thus broadens the concept of terrorism racketeering to include the construction of an existential terrorist threat as a tool of legitimising state terror. By failing to address the conditions, which foster non-state violence, the regime can continue to utilise for purposes of diplomacy and external revenue generation the dichotomy of state terror driven “authoritarian stability” and “terrorist chaos.”