In this Psalm is the following passage: “When Israel went forth from Egypt, the house of Jacob from the people of strange language, Judah became His sanctuary, Israel His domain.” Out of all people on the Earth God chose Israel to be His own; a people who would be dedicated to God and would obey God’s guidance and direction. In return God would bless Israel and be with them.
This Psalm says that God favors Israel. God influences and directs Israel so that they will become a people who are suitable to have God in their midst. God is orchestrating events so that this will happen.
On the other hand, God left the rest of the world in the control of Satan. All the other nations were given over to sin to their own destruction. Whereas Israel was set aside for God. Through Moses, God gave Israel God’s laws so that they would know how to live.
More importantly, Jesus became a man through Israel’s tribe of Judah. Salvation is through Jesus, first to Israel but also to the rest of the world.