Netanyahu, facing the prospect of an end to his 12-year run as premier, said on Twitter on Thursday "all legislators elected by votes from the right must oppose this dangerous left-wing government".

It was the first public pushback by Netanyahu, who heads the right-wing Likud party, against centrist politician Yair Lapid's announcement about 35 minutes before a Wednesday night deadline that he had succeeded in forming a governing coalition.

Under the deal, nationalist Naftali Bennett, 49, a former defence minister and a high-tech millionaire, would become prime minister and hand over the post to Lapid, 57, a former TV host and finance minister, in about two years.

The agreement capped a March 23 election in which neither Likud nor its allies nor their opponents won a majority in the legislature. It was Israel's fourth national ballot in two years.

The coalition comprises a patchwork of small and medium parties from across the political spectrum, including for the first time in Israel's history one that represents its 21 per cent Arab minority - the United Arab List.

They have little in common other than a desire to oust Netanyahu, who is also on trial on corruption charges. He denies any wrongdoing.

The lineup includes Bennett's Yamina (Rightward), centre-left Blue and White, headed by Defence Minister Benny Gantz, the left-wing Meretz and Labour parties, former defence minister Avigdor Lieberman's nationalist Yisrael Beitenu party and New Hope, a right-wing party headed by former education minister Gideon Saar, who broke away from Likud.

Political analysts have widely expected Netanyahu to try to pick off what one described as "low-hanging fruit", seizing upon Yamina members who are unhappy about joining forces with Arab and leftist lawmakers.

Tamar Zandberg, a Meretz legislator, acknowledged the difficulties in getting the alliance that her party joined off the ground.

"The coalition's test...is to be sworn in - that won't be without rough patches and problems," she said on Army Radio on Thursday.

Netanyahu controls 30 seats in the 120-member Knesset, almost twice as many as Lapid's Yesh Atid party, and he is allied with at least three other religious and nationalist parties.

A source involved in the coalition talks said the proposed new government would try to retain consensus by avoiding hot-button ideological issues such as whether to annex or cede occupied West Bank territory that Palestinians want for a state.

Bennett has said that the creation of an independent Palestine would be suicide for Israel. He made annexation of parts of territory that Israel captured in the 1967 Middle East war a major feature of his political platform but following through on that with the broad new coalition looked to be politically unfeasible.

But any new flareup along Israel's volatile border with Gaza, nearly two weeks after a ceasefire ended 11 days of fighting with the Palestinian enclave's ruling Hamas group, could challenge the stability of the broad alliance.

During his tenure as prime minister, Netanyahu has been an often polarising figure at home and abroad.

He has said a Bennett-Lapid coalition would endanger Israel's security - an allusion to efforts to curb Iran's nuclear program and managing the Palestinian issue.

Lapid was given the task of forming a government after Netanyahu failed to do so in the wake of the March election.

Netanyahu's rivals have cited the criminal charges against him as a main reason why Israel needs a new leader, arguing that he might use a new term to legislate immunity to shield himself.

Australian Associated Press