Israeli Foreign Minister Avigdor Lieberman has resigned and said that his party, Yisrael Beiteinu, would not join the new coalition government with Prime Minister Benjamin Netanyahu.
With the deadline for forming a coalition due to expire tomorrow night, Mr Netanyahu is now likely to have to govern with a thin 61-seat majority.
Mr Lieberman announced his move on Monday, and told a party meeting that it was an ideological and principled decision.
He said: “It is no secret that over the last few days we debated how to proceed.
“The dilemma was between principles and cabinet seats. I am happy to say we conceded on the seats. We could have gotten an enhanced Foreign Ministry and Immigration and Absorption portfolio.
“But we reached the clear conclusion that it wasn’t right to enter the current coalition.
“Everything we saw in the agreements with the other parties and everything we didn’t see persuaded me it wouldn’t be a nationalist government but a government of opportunism and conformism.”
Mr Lieberman told reporters his party had been offered two cabinet posts as part of the coalition talks but that he remained unsatisfied.
According to reports, his conditions for joining the coalition included full responsibility for dialogue with Washington.
He also insisted that the government set the removal of Hamas as a strategic goal.
Speaking to reporters on Monday, he said it was clear that the next government had "no intention of overthrowing the Hamas regime".
He accused Netanyahu of secretly planning to cast out Yisrael Beiteinu and Jewish Home from the coalition after the next Labour leadership race.
Likud accused Mr Lieberman of plotting to bring Zionist Union leader Isaac Herzog to power and said that he was in no place to talk about opportunism.
A Likud source close to Mr Netanyahu said: “He is a cynical politician, the ultimate opportunist, who planned to topple the prime minister and intended to be the left’s compromise candidate for prime minister after the election.
“He is completely violating the promise he made to his voters to support the formation of a nationalist government.”