Prime Minister Benjamin Netanyahu changed his mind about sacking Defense Minister Yoav Gallant amid the escalating security crisis, according to a statement he made Monday.
Netanyahu said the two had resolved their disagreement over Gallant's public call last month for a halt to the government's bitterly divisive judicial overhaul plan, which Gallant said had become a threat to Israel's security.
Last week Netanyahu announced he would delay the dismissal.
"I've decided to put our differences behind us," Netanyahu said at a Monday news conference. He said the two had worked closely together throughout the last two weeks.
An Italian tourist was killed and five people were wounded in a car-ramming in Tel Aviv on Friday hours after two Israeli sisters and their mother were killed in a shooting attack in the occupied West Bank.
The attacks, after a night of cross-border strikes in Gaza and Lebanon, added to heightened Israeli-Palestinian tensions following violent Israeli police raids in Jerusalem's Al-Aqsa Mosque this week.
The tensions threatened to widen when Israel responded to a barrage of rockets by hitting targets linked to the Islamist group Hamas in Gaza and southern Lebanon, but the fighting entered a lull on Friday.
A Sunday opinion poll, from Israel's Channel 13 News, showed Netanyahu's Likud party would lose more than a third of its seats if an election were held now, and Netanyahu would fail to gain a majority with his hard-right coalition partners.
"I'm not disturbed by the poll," Netanyahu told reporters.
The prime minister said relations with the United States, which appeared strained over the government's planned judicial overhaul, remained "tight" and the two countries enjoyed security and intelligence cooperation.
Netanyahu's government paused legislation on the overhaul to allow for compromise discussions with opposition parties following weeks of nationwide protests.
