It is a political convulsion for Israel. For the past two weeks Mr Netanyahu was expected to lose but not by the 17-point margin shown by the exit polls. Even the victors looked astonished at the political disaster that had just engulfed a man who had seemed to rise above every disaster and survive every scandal.
For the election ended up being about Mr Netanyahu himself. A lonely, suspicious, articulate man, he always had a vision of himself as the saviour of Israel. His dark personality was often compared to Richard Nixon's. He had a zest for power but a self-destructive inability to accept allies not at his beck-and-call. Most of the leaders of his party who stood with him when he won the 1996 election had been forced from office or deserted him.
In one sense, he was a victim of his own success, though his responsibility for this was dubious. Israelis always had doubts about Bibi. But he emerged during a period of acute violence. He helped to whip up right-wing nationalist crowds in 1995 just before Israel started to withdraw from the West Bank. A few months later Yigal Amir, a religious nationalist student, shot dead Yitzhak Rabin, the prime minister.
Mr Netanyahu was lucky. Shimon Peres,who succeeded Mr Rabin, might have called an election immediately. He delayed. Palestinian Islamic suicide bombers blew up two buses in Jerusalem. Mr Netanyahu ran television ads showing Mr Peres shaking hands with Yasser Arafat, the Palestinian leader. He won the election by a whisker.
Three years later there were no suicide bombs. Mr Netanyahu claimed this was his doing. But it also meant that he could not focus on the Palestinian issue in the elections. He tried to stage a confrontation by trying to close Orient House, the Palestinian headquarters in Jerusalem, but was stopped by the High Court.
He was a man of many enemies and at times he almost revelled in this. Again and again he attacked the media. They paid him back with vitriolic abuse. Last night they were reacting with glee to his fall. Amnon Abromovich, a distinguished television analyst, said: "Netanyahu will become a footnote in Israeli history who will go down as perhaps the only person who resigned 28 minutes after the television exit polls were published."
He fell because once Israeli voters could no longer be rallied against the external threat of the Palestinians, they noticed Mr Netanyahu's failings as a leader. The ethnic and religious parties, which made up his coalition, began to split. The Russians were at daggers drawn with Shas, the party of the ultra- orthodox Sephardic voters. One came from a secular, the other from a religious culture.
Mr Netanyahu also faced covert but powerful enemies. The Israeli establishment saw him as an irresponsible demagogue. Mr Barak was opportunely cleared of allegations that, as chief of staff, he had abandoned soldiers wounded in a training accident. Aryeh Deri, the leader of Shas and ally of Mr Netanyahu, was sentenced to four years' jail for accepting bribes after a court case that had dragged on for nine years. In fact, Mr Netanyahu was more used to threatening violence than actually using, but he was judged by his words.
In the end he could rely on only the ultra-orthodox when the polls opened. "We have been up since 7am bringing old people to vote in the election," said Esri Erlanger, an ultra- orthodox student. "Don't believe the polls. It will be a close election. Unfortunately, unlike the last election,the left is united and the right divided." He was right and there were already signs of anti-clerical reaction.
In the suburb of Neve Ya'akov, inhabited mainly by Russian and Moroccan Jews, Valentina from Minsk in Belorussia was voting for an extreme right- wing Russian party. But she said she would also support Mr Barak, because "Netanyahu is too close to the ultra-orthodox".
Israeli elections have always been hard fought and vitriolic because they do more than change one party or one government for another. They are part of a cultural war between different Israeli communities. This was never truer than in the 1999 election. The secular centrist parties did well, but Shas also made spectacular gains, taking much of Likud's own Sephardic voters.