Yesh Atid head Yair Lapid met with President Reuven Rivlin on Wednesday and officially asked for the mandate to form the next government.
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Prime Minister Benjamin Netanyahu's mandate expired at midnight and, with slim chances of forming a coalition, he did not seek an extension.
Rivlin is also slated to meet with Yamina leader Naftali Bennett, who also seeks to receive the mandate, despite the fact his party won only seven seats in the March 23 elections, to Lapid, 17.
Earlier Wednesday New Hope leader Gideon Sa'ar informed Rivlin that he endorses Lapid for the role of the prime minister. Blue and White leader Benny Gantz followed suit.
The president now has a choice between tasking Lapid or Bennett with forming the government or handing the mandate over to parliament. If neither move proves successful, elections – Israel's fifth in two years – will be called.
The political upset does not mean that Netanyahu will immediately be forced out as prime minister. But he now faces a serious threat to his lengthy rule amid his ongoing corruption trial.
In a brief statement, Netanyahu's Likud party blamed Yamina chairman Naftali Bennett for the prime minister's failure.
"Because of Bennett's refusal to commit to a right-wing government, something that would have certainly led to the formation of a government along with other members of Knesset, Prime Minister Netanyahu returned the mandate to the president," the statement said.
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