After a bitterly fought campaign that exposed deep splits within Israeli society and a damaging rift with Washington, Netanyahu knuckled down to the task of building a coalition likely to be dominated by right-wing and religious parties.
By mid-morning, disputes were already emerging, an indicator of likely problems in piecing together an operational government.
The coalition will have to hit the ground running in order to shore up shattered ties with the administration of US President Barack Obama and address divisions at home.
It will also have to handle an emerging nuclear deal with Iran, vehemently opposed by Netanyahu, as well as the imminent threat of Palestinian legal action at the International Criminal Court.
And pressure against West Bank settlement resurfaced, with outgoing UN Middle East envoy Robert Serry calling for the new government to "freeze" it in order to restore trust.
"Illegal settlement activity cannot be reconciled with the objective of a negotiated two-state solution and may kill the very possibility of reaching peace", said Serry, who is stepping down after seven years.
As Netanyahu formally accepted Wednesday the task of building a government, he pledged Israel would hold out a "hand of peace" to the Palestinians and make sure to patch up US ties, while continuing to fight the Iran deal.
But after a dirty campaign of inflammatory slogans and statements, people both at home and abroad will be looking for actions not words.
Netanyahu himself was at the centre of most of the controversy after he ruled out the establishment of a Palestinian state if reelected, pledged to build more settler homes in annexed east Jerusalem and played the race card at the expense of Israel's Arab minority.
- Marathon talks -
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For now, Netanyahu's focus is likely to be squarely on the marathon talks between his right-wing Likud and the five parties endorsing his premiership.
At this stage, the expected outcome is a rightwing-religious lineup of 67 MPs: Likud (30), far-right Jewish Home (eight), hardline nationalist Yisrael Beitenu (six), ultra-Orthodox parties Shas (seven) and United Torah Judaism (UTJ, six) and centre-right Kulanu (10).
With each party demanding its share, Netanyahu has four weeks to complete the task, although he can get a 14-day extension if necessary.
The only certain appointment thus far is Kulanu's Moshe Kahlon as finance minister, in line with a pre-election pledge by Netanyahu.
But the party boycotted their opening meeting with Likud on Thursday, after hearing Netanyahu intended to hand the chairmanship of the parliamentary finance committee to UTJ.
That position is seen as crucial for Kahlon to push through reforms that will tackle Israel's burgeoning housing crisis and bring down the soaring cost of living.
Representatives of the four other parties met with Likud's negotiating team throughout the day, with statements from Netanyahu's party providing no details.
So far, Netanyahu has ruled out the option of a unity government with Isaac Herzog's centre-left Zionist Union, which came second in the March 17 election with 24 seats and has pledged to enter the opposition.
But Likud's Gilad Erdan said the possibility was still on the table -- if the party's "natural allies" did not lower their demands.
Herzog in return issued a statement stressing that his party would "be a strong opposition. All the rest is media spin."
Since the election, Netanyahu has sought to backtrack on his remarks on a Palestinian state, and issued a public apology to the Arab community.
But the bad blood with Washington may take time to resolve, with the issue of the Iran talks and how to resolve the conflict with the Palestinians at the heart of an escalating dispute.