In this research, we aim to identify the most influential factors of the profitability of the Islamic banks. To do this, we use profit margin as profitability measure of banks uneder study. The research data are extracted from 29 Islamic banks in 10 members of the Organization of Islamic Cooperation (OIC) over the period 2004-2011. These are analyzed by panel data methods. The findings indicate that, out of 11 variables under study, the average annual exchange rate is of positive, strong and significant effect on “profit margin”. In addition, loans to customer deposits ratio has positive, strong and significant effect on “profit margin”.