Israel's Attorney-General has formally charged Prime Minister Benjamin Netanyahu in a series of corruption cases, which the embattled leader said was tantamount to a coup.

Key points: According to the indictment, Mr Netanyahu accepted hundreds of thousands of dollars in gifts

According to the indictment, Mr Netanyahu accepted hundreds of thousands of dollars in gifts The indictment does not require Mr Netanyahu to resign but is expected to raise pressure on him to step down

The indictment does not require Mr Netanyahu to resign but is expected to raise pressure on him to step down Two close aides to Mr Netanyahu turned state's witness and testified against him

Capping a three-year investigation, Attorney-General Avichai Mandelblit charged Mr Netanyahu with fraud, breach of trust and accepting bribes in three different scandals.

It is the first time a sitting Israeli prime minister has been charged with a crime.

Mr Netanyahu has dominated Israeli politics for a generation, having held power continuously since 2009 and before that in the 1990s.

In a televised speech shortly after the Attorney-General's remarks, Mr Netanyahu — who became Israel's longest-serving PM in July — claimed the investigation against him was tainted by bias.

He denies all wrongdoing and is under no legal obligation to resign.

"It is an attempted coup based on fabrications and a tainted and biased investigative process," Mr Netanyahu said in a televised speech.

"I will continue to lead the country, according to the letter of the law, with responsibility, devotion and concern for all of our futures."

Mr Netanyahu failed to form a government after the election in April, and he and opposition leader Benny Gantz each fell short of securing a ruling majority in parliament after the second vote designed to end the country's political deadlock in September.

Earlier in what became one of the most unusual days in Israeli political history, the country's president told MPs to name a third candidate to form a new government, a development that probably sets the stage for a third election within a year.

'A difficult and sad day'

Mr Mandelblit, who was appointed by Mr Netanyahu, said it was his duty to uphold Israeli law. ( AP: Ariel Schalit )

According to the indictment, Mr Netanyahu accepted hundreds of thousands of dollars of champagne and cigars from billionaire friends, including Australian James Packer, offered to trade favours with a newspaper publisher and used his influence to help a wealthy telecom magnate in exchange for favourable coverage on a popular news site.

The Attorney-General, who was appointed by Mr Netanyahu, spelled out the indictment in his own televised statement.

"This is a difficult and sad day," said Mr Mandelblit.

In his televised reply, Mr Netanyahu reflected a similar sentiment.

"What I'm going through is not easy. I'm a human being, too," he said.

"What my family is going through is unbearable. Every day, every evening, my blood and the blood of my wife and son are being spilled."

But Mr Mandelblit said it was his duty to ensure that no one in Israel was above the law.

Mr Netanyahu has been charged for fraud, breach of trust and accepting bribery. ( AP: Oded Balilty )

The most serious charges were connected to so-called "Case 4000," in which Mr Netanyahu is accused of passing regulations that gave his friend, telecom magnate Shaul Elovitch, benefits worth over $US500 million ($736 million) to his company Bezeq.

In return, Bezeq's news site, Walla, published favourable articles about Mr Netanyahu and his family.

The relationship, it said, was "based on a mutual understanding that each of them had significant interests that the other side had the ability to advance".

It also accused Mr Netanyahu of concealing the relationship by providing "partial and misleading information" about his connections with Mr Elovitch.

Two close aides to Mr Netanyahu turned state's witness and testified against him in the case.

The indictment also said that Mr Netanyahu's gifts of champagne from billionaires Arnon Milchan and Mr Packer "turned into a sort of supply line".

It estimated the value of the gifts at nearly $200,000.

The indictment said Mr Netanyahu assisted Israeli Milchan, a Hollywood mogul, in extending his US visa.

Mr Packer was interviewed as a witness in the case but was not accused of any criminal conduct.

ABC/wires