"Israel will accept the invitation and open an office, in the near future," Netanyahu said at the start of a cabinet meeting.
"The countries of the world want to cooperate with us because of our determined fight against terror, our technicological know-how, our intelligence network and other things," his office quoted him as saying.
NATO announced on Tuesday that it agreed that "an official Israeli mission be established at NATO headquarters" with the Israel's EU envoy as head of the mission.
An Israeli expert told AFP that the move was a result of pressure from other NATO members on Turkey, which joined in 1952, to drop its veto on closer alliance ties with its former ally.
"It's a Turkish confidence-building measure vis-a-vis Israel," said Tommy Steiner, an expert on NATO-Israel ties at the Institute for Policy and Strategy near Tel Aviv.
"Since the introduction of the new (NATO) partnership policy in 2014 Israel was formally invited," he said. "But Israel never did that because there was a Turkish veto on such a measure."
Signup to our newsletter and follow us on Facebook and Twitter!
Turkey was a key regional ally of Israel until the two cut ties in 2010 over the deadly storming by Israeli commandos of the Mavi Marmara, a Turkish aid ship bound for Gaza, which left 10 Turkish activists dead.
After years of bitter accusations and rhetoric the two sides held secret talks in December on a rapprochement, with another round taking place in February in Geneva.
"Following the Mavi Marmara affair, Turkey blocked everything (at NATO) concerning Israel," a Brussels-based diplomat told AFP. "In order to avoid discrimination (NATO) did not therefore open any other foreign mission."
"After five years the Turks lifted their objections" allowing for the establishment of missions for Israel and for other states, the diplomat said.
Steiner said that the geographically and politically diverse NATO grouping would not invite Israel into a full-fledged mutual-defence pact.
"Israel is not going to be a full member, it's not on the cards," he said. "Israel will be officially accredited to NATO, it will have a permanent mission at NATO headquarters as a partner."
Israel already participates in military exercises with NATO members other than Turkey, notably the United States.