Israeli Prime Minister Mr Ariel Sharon has failed to persuade Labour Party chairman Mr Amram Mitzna to join a broad coalition government that the right-wing leader hopes to form.
"Sharon laid out his standard line, so Mitzna had no reason to go for it," a Labour spokeswoman said at the end of the first talks between the two since the prime minister's Likud party crushed centre-left Labour in a January 28th election.
"Labour will now lead from the opposition, as it intended to do," she said.
Likud won 38 seats in the 120-member parliament, replacing Labour, which dropped from 26 seats to 19, as Israel's biggest party.
Political analysts attributed Labour's poor performance to the 28-month-old Palestinian uprising that has shattered interim peace deals the party pioneered and to Mr Mitzna's pre-election pledge not to join a Sharon-led coalition.
Mr Mitzna has been a fierce critic of Sharon's tough security stance. He advocates dismantling Jewish settlements in the occupied West Bank and Gaza Strip, which Palestinians want for a state, and unconditionally resuming peace talks.
The bad blood between Mr Mitzna and Mr Sharon runs deep. As a senior officer in 1982, Mr Mitzna publicly attacked Mr Sharon's handling, as defence minister, of the Israeli invasion of Lebanon.