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Tensions in Israel begin to ease after Netanyahu pauses judicial overhaul.

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WATCH: Netanyahu pauses judicial overhaul after mass protests

Israel’s political factions opposed to embattled Prime Minister Benjamin Netanyahu began setting up negotiating teams Tuesday after he paused a controversial judicial overhaul plan that had triggered unprecedented street protests and a spiraling domestic crisis.

But compromise seemed elusive and Netanyahu’s legacy was on the line in a standoff over the fundamental issue of what kind of country Israel shoule be — and positions only appear to have hardened.

Three months of demonstrations against the overhaul plan intensified this week and Israel’s main trade union declared a general strike, leading to chaos that shut down much of the country and threatened to paralyze the economy.

Netanyahu in a prime-time speech on Monday night acknowledged the divisions roiling the nation and announced a monthlong delay for the legislation. Within hours, analysts pointed out that firing his defense minister Sunday night heightened the outrage and sank Netanyahu’s approval among his own Likud party – which left Israel’s longest-serving leader with few choices.

“He understood that he’s in a dead end,” said Yohanan Plesner, president of Israel Democracy Institute. “And Netanyahu, who is very experienced, understood that now is the time for correction.”

In his address, the premier said he wanted “to avoid civil war” and would seek a compromise with political opponents. Netanyahu spoke after tens of thousands of people demonstrated outside the parliament building in Jerusalem.

His announcement appeared to calm some of the tensions that have fueled months of unrest. But it failed to address the underlying issues that have polarized Israelis. Netanyahu leads the most right-wing government in Israeli history and his allies have vowed to enact the legislation.

“I feel relief but with doubt,” Fega Gutman, Tel Aviv resident, said Tuesday. Netanyahu over the years “promised us a lot but didn’t always fulfill, unfortunately.”

The pause gave many Israelis time to consider the challenge ahead.

“I feel good today, everything calmed down from yesterday,” said Maor Daniel, also from Tel Aviv. “We have to figure out together how to fix the situation, how to live together.”

Some anti-government protesters stepped aside, for the moment at least, but made clear their distrust of Netanyahu and his allies. A key group, however, declared it would hold a new protest later Tuesday and again on Saturday night in Tel Aviv, which has been its practice in the last three months.

“The protesters who take to the streets are not stupid,” the group known as the Umbrella Movement of Resistance against Dictatorship said in a statement. “Millions of citizens who have protested until now will not give up.”

A flurry of phone calls between rival opposition leaders followed Netanyahu’s announcement and lasted into Tuesday morning, with several working groups named as the protests subsided and Israel’s largest labor union called off its general strike.

“When there’s an opportunity to avoid civil war through dialogue, I, as prime minister, am taking a timeout for dialogue,” Netanyahu said in his speech. He vowed to reach a “broad consensus” during the summer session of parliament, which begins on April 30.

The country’s figurehead president, Isaac Herzog, said pausing the legislative blitz was “the right thing” and offered to oversee the negotiating teams. He spoke in separate phone calls with Netanyahu, opposition leader Yair Lapid and National Union Party Chairman Benny Gantz, his office said.

“This is the time for frank, serious and responsible discussion that will lead urgently to calming spirits and lowering the flames,” Herzog said.

National Security Minister Itamar Ben-Gvir, an ultranationalist who has pushed for quick passage of the package, said it ”will pass,” though he would respect the delay. “No one will scare us,” he tweeted.

Critics say the legislative package would hobble the country’s system of checks and balances. Protesters vowed to intensify their demonstrations.

The overhaul would give Netanyahu, who is on trial on corruption charges, and his allies the final say in appointing the nation’s judges. It would also give parliament, which is controlled by his allies, authority to overturn Supreme Court decisions and limit the court’s ability to review laws.

Netanyahu has argued that the overhaul is needed to rein in a liberal and overly interventionist court of unelected judges. But his opponents say the package would concentrate too much power in the hands of Netanyahu’s allies. They also say that he has a conflict of interest as a criminal defendant.

Large swaths of Israeli society and governments around the world condemned the overhaul. Business leaders, top economists and former security chiefs have all come out against the plan, saying it is pushing the country toward an autocracy. Fighter pilots and military reservists have threatened not to report for duty, and the country’s currency, the shekel, has tumbled in value.

Tens of thousands of people, largely secular, middle-class Israelis, have regularly joined mass protests against it.

The situation escalated on Sunday night after Netanyahu abruptly fired Defense Minister Yoav Gallant, who had urged him to put his plan on hold, citing concerns about damage to the Israeli military.

Chanting “the country is on fire,” furious protesters lit bonfires on Tel Aviv’s main highway, closing the thoroughfare and many others throughout the country for hours. Demonstrators continued Monday outside the Knesset, or parliament, turning the streets surrounding the building and the Supreme Court into a roiling sea of blue-and-white Israeli flags dotted with rainbow Pride banners.

Departing flights from the main international airport were grounded, stranding tens of thousands of travelers. Large mall chains and universities closed their doors, and the union called for its 800,000 members to stop work in health care, transit, banking and other fields.

Israel’s Palestinian citizens have largely sat out the protests. Many say Israel’s democracy is tarnished by its military rule over their brethren in the West Bank and the discrimination they themselves face.

Even with the big issues standing, officials inside and outside Israel signaled relief that the pause had bought some time. The Biden administration welcomed Netanyahu’s announcement, making its encouragement clear by dangling the prospect of an upcoming visit, “soon,” by the Israeli premier to the White House.

“I had a nice night of sleep last night, thank God,” U.S. Ambassador Tom Nides told Israel Army Radio on Tuesday. “This morning I’m optimistic and I applaud the move.”

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