The twenty-sixth government of Israel was formed by Shimon Peres of the Labor Party on 22 November 1995, following the assassination of Yitzhak Rabin on 4 November. Peres kept the same coalition as previously, namely the Labor Party, Meretz and Yiud, which together held only 58 of the 120 seats in the Knesset. However, the government was also supported, but not joined, by Hadash and the Arab Democratic Party, which held an additional five seats between them.

The twenty-seventh government of Israel was formed by Benjamin Netanyahu of Likud on 18 June 1996. Although his Likud-Gesher-Tzomet alliance won fewer seats than Labor, Netanyahu formed the government after winning the country's first ever direct election for Prime Minister, narrowly defeating incumbent Shimon Peres. This government was the first formed by an Israeli national born in the state after independence in 1948.