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The 1986–87 Cypriot Cup was the 45th edition of the Cypriot Cup. A total of 57 clubs entered the competition. It began on 19 November 1986 with the first preliminary round and concluded on 20 June 1987 with the final which was held at Tsirion Stadium. AEL Limassol won their 5th Cypriot Cup trophy after beating Apollon 1–0 in the final.
The competition consisted of seven knock-out rounds. In the preliminary rounds each tie was played as a single leg and was held at the home ground of one of the two teams, according to the draw results. Each tie winner was qualifying to the next round. If a match was drawn, extra time was following. If extra time was drawn, there was a replay at the ground of the team who were away for the first game. If the rematch was also drawn, then extra time was following and if the match remained drawn after extra time the winner was decided by penalty shoot-out.
The next four rounds were played in a two-legged format, each team playing a home and an away match against their opponent. The team which scored more goals on aggregate, was qualifying to the next round. If the two teams scored the same number of goals on aggregate, then the team which scored more goals away from home was advancing to the next round.
If both teams had scored the same number of home and away goals, then extra time was following after the end of the second leg match. If during the extra thirty minutes both teams had managed to score, but they had scored the same number of goals, then the team who scored the away goals was advancing to the next round (i.e. the team which was playing away). If there weren't scored any goals during extra time, the qualifying team was determined by penalty shoot-out.
In the first preliminary draw, participated all the 14 teams of the Cypriot Third Division and 12 teams from the Cypriot Fourth Division (first four of the league table of each group at the day of the draw). Eight out of the 26 teams were drawn to qualify directly to the second preliminary round, without needing to play any match.