SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                              --------------------

                                    FORM 6-K
                        Report of Foreign Private Issuer
                        Pursuant to Rule 13a-16 or 15d-16
                     of the Securities Exchange Act of 1934
                          For the Month of August 2004
                             -----------------------

                        AMERICAN ISRAELI PAPER MILLS LTD.
                 (Translation of Registrant's Name into English)
                          P.O. Box 142, Hadera, Israel
                    (Address of Principal Corporate Offices)

Indicate by check mark whether the registrant  files or will file annual reports
under cover of Form 20-F or Form 40-F:

                     |X|         Form 20-F         |_|     Form 40-F

Indicate by check mark if the  registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1): |_|

Note:  Regulation  S-T Rule  101(b)(1) only permits the submission in paper of a
Form 6-K if submitted  solely to provide an attached  annual  report to security
holders.

Indicate by check mark if the  registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7): |_|

Note:  Regulation  S-T Rule  101(b)(7) only permits the submission in paper of a
Form 6-K  submitted to furnish a report or other  document  that the  registrant
foreign  private  issuer  must  furnish  and make  public  under the laws of the
jurisdiction  in which the  registrant  is  incorporated,  domiciled  or legally
organized  (the  registrant's  "home  country"),  or under the rules of the home
country exchange on which the registrant's securities are traded, as long as the
report or other document is not a press  release,  is not required to be and has
not been distributed to the registrant's  security holders, and, if discussing a
material  event,  has already been the subject of a Form 6-K submission or other
Commission filing on EDGAR.

Indicate by check mark whether the  registrant  by  furnishing  the  information
contained  in this  form is  also  thereby  furnishing  the  information  to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

                     |_|      Yes               |X|      No

If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82-______________







         Attached hereto as Exhibit 1 and incorporated by reference herein is
the Registrant's press release dated August 25, 2004.












                                    SIGNATURE
                                    ---------

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



                                        AMERICAN ISRAELI PAPER MILLS LTD.
                                        (Registrant)


                                        By: /s/ Lea Katz
                                           -------------------------------------
                                           Name:  Lea Katz
                                           Title: Corporate Secretary

Dated:  August 26, 2004.





                                  EXHIBIT INDEX
                                  -------------


      Exhibit No.           Description
      -----------           -----------

           1.               Press release dated August 25, 2004.








                                    EXHIBIT 1
                                    ---------



                                                AMERICAN ISRAELI
                                                PAPER MILLS LTD.


                                                          PHILIP Y. SARDOFF

                                                      IMMEDIATE



                        AMERICAN ISRAELI PAPER MILLS LTD.
                      DETERMINES DOLLAR AMOUNT OF DIVIDEND

Hadera, Israel, August 25, 2004... As previously announced on August 12, 2004,
American Israeli Paper Mills Ltd. (ASE:AIP) declared a cash dividend in the
amount of NIS 25.12425 per share payable on September 9, 2004 to shareholders of
record on August 25, 2004. The exact dollar payout was to be based on the rate
of exchange of the NIS in relation to the US Dollar in effect on August 25,
2004, the record date, and has now been determined to be $5.5388 per share
before tax.





(10903 sec-press)