Israeli Prime Minister Ariel Sharon has asked the opposition Labour Party to begin talks to form a unity government, a move that would avert early elections and pave the way for a withdrawal from Gaza.
Sharon issued the invitation in a call to Labour leader Shimon Peres, his old ideological rival and Israel's leading dove, after the Likud party's Central Committee voted on Thursday to reverse its earlier ban on negotiating an alliance.
Averting a likely snap election, Likud's central committee reversed an earlier decision by voting 62 to 38 per cent last night to allow talks on a unity government.
It was a blow for hardline party rebels, who oppose giving up the Gaza Strip or any land captured in the 1967 war, and tried to prevent an alliance with pro-withdrawal Labour as a way to stop it.
Western countries, buoyed by new hope of Middle East peace talks after Yasser Arafat's death last month, back the Gaza withdrawal as a step towards a settlement. But Palestinians fear it is a ruse to cement Israel's hold on the West Bank.
Likud hardliners failed in a last-minute bid to stop the Likud vote in Tel Aviv. They oppose Mr Sharon's plan to withdraw from Gaza and evacuate four of 120 settlements in the West Bank next year, calling it a "victory for terror".
Last night's non-binding vote reverses the decision of the Central Committee in August to reject bringing dovish Labour into the coalition. Members were also asked to authorise coalition talks with two ultra-Orthodox parties.
The risk of elections, almost two years early, appeared to have persuaded party members. Voters yearning for political stability might have taken out their anger on Likud by reducing its 40-seat strength in the 120-member parliament.
Coalition building was expected to begin on Sunday after Labour's leadership, due to meet on Saturday night, gives its consent.