Gantz, a former armed forces chief, beamed with confidence as he told a rally of his Blue and White Party that it appeared "we fulfilled our mission", and he pledged to work towards formation of a unity government. Benjamin Netanyahu, Israel's prime minister. Credit:Bloomberg Netanyahu, he said, apparently "did not succeed in his mission" to win a fifth term. "We will await the actual results," Gantz, 60, said. The final election results can take more than a week, but partial results are published by the Knesset as the vote-counting proceeds, so a clearer picture will likely emerge within a day before the final tally.

By 7:30, Israel time, with 92 per cent of the votes counted Netanyahu's Likud party had 32 seats outright, and with his bloc 56 of the 61 seats needed to form majority. Revised surveys by Israeli TV stations, several hours after polls closed, gave Likud 30 to 33 of parliament's 120 seats, a slight drop from earlier forecasts, versus 32 to 34 for Blue and White. Neither had enough support, at first glance, for a governing coalition, and Netanyahu's ally-turned-rival, former Defence Minister Avigdor Lieberman, emerged as a likely kingmaker as head of the far-right Yisrael Beitenu party. Blue and White party leaders, from the left, Gabi Ashkenazi, Yair Lapid, Benny Gantz (with the microphone) and Gabi Ashkenazi greet their supporters at party headquarters after the first results of the elections in Tel Aviv. Credit:AP Addressing his supporters early on Wednesday, Netanyahu vowed to work to form a new government that excludes Arab parties. His campaign focused heavily on attacking and questioning the loyalty of the country's Arab minority - a strategy that drew accusations of racism and incitement from Arab leaders.

"In the coming days we will convene negotiations to assemble a strong Zionist government and to prevent a dangerous anti-Zionist government," he said. He claimed that Arab parties "negate the existence of Israel as a Jewish and democratic state" and "glorify bloodthirsty murderers." Israeli exit polls are often imprecise. The updated polls showed that without Yisrael Beitenu's projected eight to nine seats, stalemate could ensue: Likud would have the support of only up to 55 legislators, down from 57 in the earlier exit polls, for a right-wing coalition. Blue and White could enlist the backing of no more than 59 for a centre-left government. Kingmaker: Avigdor Lieberman. Credit:Reuters Arab parties, which have never before sat in an Israeli government, also finished strong, and exit polls predicted they would form the third largest party in parliament. The exit polls predicted they could take up to 15 seats. Addressing his supporters late on Tuesday (Wednesday AEST), a jubilant Lieberman said he saw only "one option:" a broad, secular coalition with both Blue and White and Likud.

"We've always said that a unity government is only possible in emergency situations. And I tell you and I tell every citizen today watching us on television: the situation, both security-wise and economically, are emergency situations," he said. "The country, therefore, requires a broad government." Early on Wednesday, Gantz told a cheering rally of supporters that while it was too soon to declare victory, he had begun speaking to potential partners and hoped to form a unity government. Loading "Starting tonight we will work to form a broad unity government that will express the will of the people," he said. Attention will now focus on Israeli President Reuven Rivlin, who is to choose the candidate he believes has the best chance of forming a stable coalition. Rivlin is to consult with all parties in the coming days before making his decision.

After that, the prime minister designate would have up to six weeks to form a coalition. If that fails, Rivlin could give another candidate for prime minister 28 days to form a coalition. And if that doesn't work, new elections would be triggered yet again. Rivlin has said he will do everything possible to avoid such a scenario. Tuesday's election was an attempt at clarity after the April election failed to produce a coalition. Lieberman called for an immediate start to negotiations and predicted it could be wrapped up quickly. But such a deal promises to be complicated. Loading Gantz, a former military chief who has presented himself as a unifying figure in a divided nation, has ruled out a partnership with Likud if Netanyahu remains at the helm at a time when he is expected to be indicted on criminal charges. But in his speech, he made no such conditions. "I intend to speak with everyone," he said, without mentioning Netanyahu.

Lieberman, who leads a nationalist but secular party, is unlikely to sit with Arab parties on the left or ultra-Orthodox religious parties on the right. That could limit both Gantz's and Netanyahu's ability to manoeuvre and could potentially put pressure on the longtime leader, who has ruled for over a decade, to step aside. Loading Likud members said they remained behind their leader. "We have the basic principal of standing by the party leader who was elected in the party primary, which is why we won't take action against Netanyahu," said lawmaker Micky Zohar, a Netanyahu loyalist.

Netanyahu had sought an outright majority with his allies in hopes of passing legislation to give him immunity from the expected indictment. Israel's Attorney-General has recommended charging Netanyahu with bribery, fraud and breach of trust in three scandals, pending a hearing scheduled next month. A formal indictment would increase the pressure on Netanyahu to step aside if he does not have immunity. Loading Netanyahu tried to portray himself as a seasoned statesman uniquely qualified to lead the country through challenging times during an alarmist campaign marked by mudslinging and slogans that were condemned as racist. Gantz tried to paint Netanyahu as divisive and scandal-plagued, offering himself as a calming influence and honest alternative. Netanyahu's campaign promoted images of him jetting off to world capitals and boasting of warm relations with powerful leaders, most notably US President Donald Trump.

At the same time, he issued repeated doomsday warnings that his opponents were scheming with politicians from the country's Arab minority to "steal" the election. He tried, and failed, to pass legislation that would allow cameras in polling stations, a step he said was needed to crack down on alleged fraud in Arab towns. Facebook suspended his account for 24 hours last week after it published a post saying that "Arabs want to annihilate all of us." Netanyahu also sought to appeal to his hardline base with a number of election promises, including plans to annex all of Israel's settlements in the West Bank. His proposal, which could extinguish any remaining hopes for a Palestinian state, were condemned by much of the world, including important Arab countries like Jordan and Saudi Arabia. But the US remained muted, suggesting he had coordinated with Washington ahead of time. Netanyahu's frenetic warnings about Arabs appeared to backfire, turning off some Jewish voters and driving heavy turnout in the Arab sector.

Ayman Odeh, leader of the main Arab faction in parliament, said Netanyahu's repeated attacks had boosted turnout and hurt Netanyahu in the end. "There's a heavy price to pay for incitement," he told Channel 13 TV. In April's vote, Netanyahu appeared to have the upper hand, with his traditional allies of nationalist and ultra-religious Jewish parties controlling a parliamentary majority. But Lieberman, his mercurial ally-turned-rival, refused to join the new coalition, citing excessive influence it granted the ultra-Orthodox Jewish parties. Without a parliamentary majority, Netanyahu dissolved parliament and called a new election. Lieberman's gamble paid off Tuesday, and exit polls suggested his party had nearly doubled in strength, to as many as 10 seats.

Israel's election commission said 69.4 per cent of all eligible voters cast ballots by the time polls closed on Tuesday evening, a slightly larger number than took part in April's vote. Turnout in April's elections was 68.5 per cent. Reuters, AP