Israel's new government will take office on Thursday after Acting Prime Minister Ehud Olmert formed a coalition to carry out his plan to redraw Jewish settlement lines in the occupied West Bank.
A parliamentary official confirmed that the new government would be sworn in on Thursday.
The governing coalition will control at least 67 seats in the 120-seat chamber, a majority narrower than he had sought in several weeks of negotiations with political parties.
Olmert's Kadima party signed agreements with centre-left Labour, the ultra-Orthodox Shas faction and a pensioners' party, after falling short of a parliamentary majority in March's election.
Issuing cabinet portfolios to Kadima's senior members, Olmert named 82-year-old Shimon Peres as one of his deputies and named him minister of regional development.
"Peres will be the government's elder statesman, to be sent on special missions to the Arab world and European nations," said a senior official in Kadima, which Peres joined after losing a Labour Party leadership election.
Foreign Minister Tzipi Livni, widely seen as a rising star in Israeli politics and a former operative of Israel's Mossad spy agency, will remain at her post.
Israel's Defence Minister Shaul Mofaz did not fare as well. He will serve as one of Olmert's deputies and as transport minister but will relinquish the defence portfolio to Labour leader Amir Peretz, a former trade union chief.
Palestinians regard Mofaz as one of Israel's most hard-line leaders, citing tough measures he has overseen - including assassination of top militants and tight travel restrictions - to battle anti-Israeli violence.
Olmert became interim prime minister after Ariel Sharon suffered a stroke and fell into a coma in January.
A former Jerusalem mayor, Olmert has said he will wait, but not for long, for the militant Hamas group, now heading the Palestinian government, to show if it will moderate its position calling for Israel's destruction and become a peace partner.
Peace prospects appear dim as Hamas has defied Israeli and international demands to renounce violence, recognise Israel and accept previous interim peace deals.
In another key cabinet appointment, Abraham Hirschson, a close Olmert ally and currently minister of tourism and communications, was named finance minister. He is expected to continue pursuing budget discipline and free-market policies.
Labour will hold seven cabinet posts, the pensioners' party two, and Shas, three.