The rapid development of technology has enabled the creation of artificial intelligence. Even the most vocal critics against artificial intelligence and automated systems acknowledge the tremendous benefits offered by this new technology as can be seen in various aspects of human life from trade and commerce, healthcare, safety and security, transportation to social life and beyond. At the same time, the spread of artificial intelligence, automated systems, and robotics poses an incredible risk to our jobs, privacy, safety, health and more. The purpose of this article is to understand the level of impact posed by artificial intelligence and to establish legal rights and liabilities for artificial intelligence. This article also analyzes the viewpoint of Islam on this phenomenon. This article is mostly library-based, benefitting from the extensive literature already available in international journals, books by scholars, and online news. In addition, this article also benefitted from interviews with scholars and experts on cybersecurity and artificial intelligence. The ultimate focus is on the possible recognition of artificial intelligence as a legal entity in its own right, capable of possessing rights and liabilities. The additional focus is on the Islamic perspective on the matter. This article shows that there is an urgent need to establish a uniformed minimum legal rights and liabilities for parties involved, including consumers, manufacturers, and designers, although such rights and liabilities can be tailored to fit the unique scenarios faced by the parties. This article reveals that Islam provides various useful guidelines on this modern and unique matter.