From the founding of Israel in 1948 until the election of May 1977, Israel was ruled by successive coalition governments led by the Labor alignment or its constituent parties. From 1967-70, the coalition government included all of Israel's parties except the communist party. After the 1977 election, the Likud bloc, then composed of Herut, the Liberals, and the smaller La'am Party, came to power forming a coalition with the National Religious Party, Agudat Israel, and others. As head of Likud, Menachem Begin became Prime Minister. The Likud retained power in the succeeding election in June 1981, and Begin remained Prime Minister. In the summer of 1983, Begin resigned and was succeeded by his Foreign Minister, Yitzhak Shamir.

After losing a Knesset vote of confidence early in 1984, Prime Minister Shamir was forced to call for new elections, held in July of that year. The vote was split among numerous parties and provided no clear winner, leaving both Labor and Likud considerably short of a Knesset majority. Neither Labor nor Likud was able to gain enough support from the small parties to form even a narrow coalition. After several weeks of difficult negotiations, they agreed on a broadly based government of national unity. The agreement provided for the rotation of the office of Prime Minister and the combined office of Vice Prime Minister and Foreign Minister midway through the government's 50-month term.

During the first 25 months of unity government rule, Labor's Shimon Peres served as Prime Minister, while Likud's Yitzhak Shamir held the posts of Vice Prime Minister and Foreign Minister. Peres and Shamir switched positions in October 1986. The November 1988 elections resulted in a similar coalition government. Likud edged Labor out by one seat but was unable to form a coalition with the religious and right wing parties. Likud and Labor formed another national unity government in January 1989 without providing for rotation. Yitzhak Shamir became Prime Minister, and Shimon Peres became Vice Prime Minister and Finance Minister.

The national unity government fell in March 1990 in a vote of no confidence precipitated by disagreement over the government's response to U.S. Secretary of State Baker's initiative in the peace process. Labor Party leader Peres was unable to attract sufficient support among the religious parties to form a government. Yitzhak Shamir then formed a Likud-led coalition government, including members from religious and right-wing parties.

Shamir's government took office in June 1990, and held power for 2 years. In the June 1992 national elections, the Labor Party reversed its electoral fortunes, taking 44 seats. Labor Party leader Yitzhak Rabin formed a coalition with Meretz (a group of three leftist parties) and Shas (an ultra-Orthodox religious party). The coalition included the support of two Arab-majority parties. Rabin became Prime Minister in July 1992. Shas subsequently left the coalition, leaving Rabin with a minority government dependent on the votes of Arab parties in the Knesset.

Rabin was assassinated by a right-wing Jewish radical on November 4, 1995. Peres, then Deputy Prime Minister and Foreign Minister, once again became Prime Minister and immediately proceeded to carry forward the peace policies of the Rabin government and to implement Israel's Oslo commitments, including military redeployment in the West Bank and the holding of historic Palestinian elections on January 20, 1996.

Enjoying broad public support and anxious to secure his own mandate, Peres called for early elections after just 3 months in office. (They would have otherwise been held by the end of October 1996.) In late February and early March, a series of suicide bombing attacks by Palestinian terrorists took some 60 Israeli lives, seriously eroding public support for Peres and raising concerns about the peace process. Increased fighting in southern Lebanon, which also brought Katyusha rocket attacks against northern Israel, also raised tensions and weakened the government politically a month before the May 29 elections.

In those elections--the first direct election of a Prime Minister in Israeli history--Likud leader Binyamin Netanyahu won by a narrow margin, having sharply criticized the government's peace policies for failing to protect Israeli security. Netanyahu subsequently formed a predominantly right-wing coalition government publicly committed to pursuing the peace process, but with an emphasis on security and reciprocity. His initial coalition included Likud, allied with the Tsomet and Gesher parties in a single list, three religious parties, and two centrist parties. The Gesher Party withdrew from the coalition in January 1998. In 1999, facing increasing difficulty passing legislation and defeating no-confidence motions, Netanyahu dissolved parliament and called for new elections. This time, the Labor candidate--Ehud Barak--was victorious. Barak formed a mixed coalition government of secular and religious parties. Likud served in the opposition. In May 2000, Barak fulfilled one of his major campaign promises by withdrawing Israeli forces from Southern Lebanon. However, by mid-autumn, with the breakdown of the Camp David talks and the worsening security situation caused by the new intifada, Barak's coalition was in jeopardy. In December, he resigned as Prime Minister, precipitating a new prime ministerial election.

In a special election on February 6, 2001, after a campaign stressing security and maintaining Israeli sovereignty over Jerusalem, Likud leader Ariel Sharon defeated Barak by over 20 percentage points. As he had promised in his campaign, Sharon formed a broad unity government that included the Labor and Likud parties, the far-right parties, some smaller secular parties, and several religious parties. The unity government collapsed in late 2002, and new elections were held in January 2003. Sharon again won, and formed a new government consisting of his own Likud party, the right-wing National Religious Party and National Union party, and centrist Shinui.