Coalition party heads in Prime Minister Benjamin Netanyahu's government have chose to dissolve parliament and hold elections in early April "in the name of budgetary and national responsibility", the statement distributed by a spokesman for Netanyahu's Likud party said.
Netanyahu's coalition has been teetering on the edge with a one-seat majority since the November 14 resignation of the Israeli minister for military affairs, Avigdor Liberman, who stepped down over the Tel Aviv's handling of ongoing tensions in the Gaza Strip. Lieberman urged Syrian President Bashar al-Assad to expel Iranian forces from his country, after Israeli air strikes hit alleged Iranian targets in Syria.
Netanyahu - who has been a mainstay in Israeli politics for decades - is battling bribery charges that could potentially bring an end his career. The attorney general has not yet decided whether to act on police recommendations that he be indicted.
The country's attorney general is now deciding whether to press charges. The Justice Ministry announced today that deliberations were continuing and were "not dependent on political events".
Mr Netanyahu has angrily dismissed the accusations against him, characterising them as part of a media-driven witch hunt that is obsessed with removing him from office. He has vowed to carry on and keep serving.
Turkey and Israel have seen deteriorating relations in recent months, and follows a complete freezing of ties when Turkish activists were killed by Israeli soldiers on a flotilla travelling to Gaza in 2010.
"He wants to turn around to the attorney general and say 'before you decide to prosecute me pay attention".
However, Netanyahu may still run into trouble if he plans to count on the support of his current senior collation partner again.
"All good things come to an end", Jewish Home party leader Naftali Bennett said, after nearly four years in the Likud-led government.
Though the polls now don't bode well for most of the centre and left-wing opposition parties, there was widespread excitement among them at the prospect of a new election.
Erdogan "knows what a moral army is and he knows what a genuine democracy is, as opposed to an army that massacres women and children in Kurdish villages and a state, which, to my regret, is becoming more dictatorial day by day", Netanyahu said.
Netanyahu, who also served a term in the late 1990s, has been prime minister for the past decade.
Netanyahu, now in his fourth term as prime minister, has been governing with a slim majority of 61 seats in the 120-member parliament.
A statement from their Zionist Union alliance said: "We welcome the early elections".
New elections are tentatively scheduled for April 9, 2019, four years since the last election, and six months before the previously scheduled election date of November 5, 2017.
Former Prime Minister Ehud Barak called the election "the most fateful" since the assassination of then-Prime Minister Yitzhak Rabin in 1995. But following the military campaign to uncover the Hezbollah tunnel network from Lebanon into Israel, he said the country was now in a different place.