Cyberspace has expanded the arena within which extremists and terrorists operate, posing a range of new challenges, many of which are still to be addressed. From propaganda through recruitment to financing and attack planning, the use of the Internet has been growing in size, subtlety and sophistication, often blurring the legal with the illegal. Its interconnectivity, anonymity and affordability have served Muslim extremists, white supremacists and neo-Nazis alike. The present article analyses the online challenges posed by such groups, pointing out how they might be potentially hampered by combining the currently dominant online surveillance with marginalized cyber (counter-) communication. It also highlights the mechanisms of decision making based on matters of principle and honour, the factors that typically drive terrorist actions, showing the inadequacy of the traditional economic models, on which the surveillance largely depends and risks scaring extremists off the radar.