Benjamin Netanyahu faces uncertainty over his political future, as neither his bloc nor the opposition led by Gadi Eisenkot appears to secure the 61-seat majority in the Israeli parliament.
With around 70% of votes counted, Arab parties could win between 16 and 19 seats, becoming a decisive factor in forming the next government.
Eisenkot is under pressure to cooperate with these parties, while Democrats leader Yair Golan has warned that excluding them could give Netanyahu an advantage.
Meanwhile, Donald Trump claims that his public support helped the Israeli prime minister in the election.
Vote counting continues, with turnout reaching 77.7%, the highest level since 1999. The final result and post-election negotiations will determine whether Netanyahu remains in power or Israel faces another political deadlock.