Spearheaded by CEO Alex Karp and Paypal co-founder Peter Thiel, CIA’s stealthy tech corporation, Palantir, is padding its pockets with billions in both government and private funding—and raising controversy over data systems that monitor visa holders, track immigration, and allegedly draw from several government agencies’ records to access information about U.S. citizens.
The Origins of Palantir
Founded in 2003 by Peter Thiel, Alex Karp, and others in the In-Q-Tel, a CIA-chartered non-profit, Palantir was originally intended to combat terrorism by using data analytics and AI-driven pattern detection for post-9/11 counterintelligence.
Palantir’s first contracts were with the CIA and other U.S. intelligence agencies. With nearly $2 million in backing from the CIA, Palantir developed the Gotham platform. Gotham, a data integration and analysis platform for complex datasets, became widely used across government agencies like the CIA, NSA, and the FBI for geospatial intelligence and combat mission planning.
Afghanistan Technology & Army Contracts
In 2012, Palantir worked with the US Army to make military decisions using aerostats, large surveillance balloons, and biometric data such as fingerprints. Palantir’s predictive technology was able to detect explosive devices, and in 2018, the Army administered nearly $900 million to both Palantir and Raytheon to continue working on Army systems and analytics software.
Last year, Palantir collaborated with Anduril Industries, an autonomous defense tech company founded by Oculus founder Palmer Luckey, and other established weaponry manufacturers to create AI-powered super trucks for the military, several of which are now deployed at Army bases in the Pacific Northwest.
After Palantir’s initial success, they won contracts with ICE, the Pentagon, the IRS, and more. Palantir gained a reputation as a “shadow system integrator” of federal data infrastructure.
Lately, Palantir has won government contracts at a shocking rate, winning 51 contracts in quarter one of 2025 alone. The company is swiftly making a name for itself that is rivalring legacy defense contractors like Raytheon and Booz Allen.
Monitoring Immigration with ICE
Just this April, Palantir won a nearly $30 million contract to develop ImmigrationOS, a software built to track self-deportations and visa overstays. The immigrant-tracking software will pull data from federal databases such as Customs & Border Protection (CBP) records and biometrics such as fingerprints and facial recognition to identify the identities and locations of people that ICE deems a priority case.
ImmigrationOS proposes a major expansion of ICE’s current surveillance infrastructure. Critics of the software argue the initiative could quietly normalize long-term data collection and blur the boundaries between civil immigration law enforcement and national security operations. The system raises several concerns about due process. Additionally, it may lead to an increase in automating law enforcement decisions without sufficient public accountability.
What’s Next: A Controversial Mega-Database
Now, the defense superpower is supposedly working on a “mega-database” initiative that will consolidate federal data into one large AI-powered platform. This platform would include data from the Pentagon, the IRS, the military, and more, streamlining cross-agency operations. Unverified prototypes of this so-called “mega-database” exist, but while the media and whistleblowers consistently report that the initiative is underway, Palantir publicly denied involvement with a mega-database of any kind this May.
This ambitious new proposal raises concerns and controversy. Civil liberty groups argue the mega-database could enable mass surveillance and blur the lines between civilian and military data use. Additionally, there is ongoing scrutiny from Congress over a lack of transparency. Many groups are concerned about a private company having so much control over national infrastructure.
Palantir’s deepening entanglement with federal agencies from battlefield AI to the rumored mega-database suggests a shift in how government data is collected and used. Once a shadowy counterterrorism startup, Palantir is making a new name for itself in the center of American governance, blurring the lines between private tech contractor and public infrastructure. As the company’s influence expands, so do the stakes: questions of accountability, civil liberties, and transparency.