Blue and White leader Benny Gantz informed President Reuven Rivlin on Wednesday evening that he did not succeed in forming a governing coalition.
Gantz returned the mandate four hours before the midnight deadline.
Prime Minister Benjamin Netanyahu sent an olive branch to Gantz on Wednesday after coalition kingmaker Avigdor Liberman ended the last chance for Gantz to form a minority government.
Netanyahu and Gantz met late Tuesday night and left without an agreement on a unity government. They attacked each other after the meeting, but Netanyahu reached out to him in a meeting of the 55 MKs in his bloc of right-wing and religious parties.
“Benny Gantz, it is not too late,” Netanyahu said. “Come sit together and announce still tonight that we are forming a unity government. This is what Israel needs. It is forbidden to drag Israel into additional elections.”
Netanyahu criticized Gantz for supporting what he called a “delusional” idea of building a minority government backed by Arab MKs. He blamed Blue and White number two Yair Lapid for persuading Gantz to adopt the idea.