Using the -

public JInternalFrame(String title,
                       boolean resizable,
                       boolean closable,
                       boolean maximizable,
                       boolean iconifiable)

constructor with all trues does not make the internal frame iconifiable.

But using the default constructor and then setting the frame attributes
works correctly. It seems to be order sensitive also. The order from
swingset demo seems to work. Here is the code snippet from
swing0.5.1 examples/SwingSet/InternalFramePanel.java -

        JInternalFrame w;
int layer;
        w = new JInternalFrame();
        w.setClosable(closeBox.isSelected());
        w.setMaximizable(maxBox.isSelected());
        w.setIconifiable(iconBox.isSelected());
        w.setTitle(titleField.getText());
        w.setResizable(resizeBox.isSelected());