Yesh Atid and the Democrats Party voided a deal with Likud over sharing appointments to the World Zionist Organization.
This comes in response to Prime Minister Benjamin Netanyahu's son, Yair, being chosen as a World Zionist Organization board member on Wednesday.
"As soon as his name was announced, all discussion at the World Zionist Congress stopped. Everyone is shocked by the decision, and the agreement is currently at risk," said a source from Yesh Atid.
Yesh Atid said in a statement, "We heard with astonishment the despicable decision to appoint Yair Netanyahu to a senior position in the Zionist institutions. Yesh Atid will not sign any such agreement in the WZO."
"This is a corrupt and shameful appointment, and a step in the destruction of Israel's national institutions," a statement from the Democrats Party read.
"Yair Netanyahu, a person who has dedicated his life to incitement and division, is unworthy of representing the Jewish people or enjoying public status and funds. We will not cooperate with this disgraceful appointment, and will do everything to block the mafia-like takeover by the Netanyahu family," the Democrats Party added.
"We've completely lost our minds. The peak of the filth - the appointment of Yair Netanyahu, who fled the country during wartime, to a senior position in the Zionist institutions as part of a deal with opposition parties," Yoaz Hendel's Reservists Party said in a statement.
"There's no one there who thinks that after a war like this, it's even symbolically appropriate to appoint reservists, or just someone who did something for the country in the last two years. There's everything here except Zionism," the statement continued.
Yair Netanyahu is expected to manage the hasbara department and would receive conditions equivalent to a minister. He would also receive an office and a car.
Yisrael Beytenu supported Netanyahu's appointment as part of a deal, in which Yesh Atid received the Finance Department and the chairmanship of the Jewish National Fund for Meir Cohen.
WZC technically extended two weeks to vote later to officiate positions
The World Zionist Congress voted to technically extend the convention by two weeks to allow delegates to vote to officiate the national institution positions agreed upon in a coalition agreement.
The Congress continued voting too late into the night, and the following day’s programming was cancelled due to expected haredi protests that would disrupt delegates' ability to travel home.
Before the vote, Culture and Sport Minister Miki Zohar, on behalf of the Likud, sought to appoint Yair Netanyahu to the World Zionist Organization board, which had been expanded to 24 seats in a constitutional amendment.
Zohar was backed by the prime minister in his bid for leadership of World Likud, which had devolved into a power struggle between him and a faction led by WZO chairman Yaakov Hagoel.
The coalition agreement would see World Mizrachi CEO Rabbi Doron Perez become the new chairman of the World Zionist Organization. There would be a power-sharing rotation with Yesh Atid in the second half of the term.
Leadership of Keren Kayemeth LeIsrael-Jewish National Fund is set to be split between Yesh Atid and the Likud, in another rotation. MK Meir Cohen is set to be the chairman of KKL-JNF on behalf of Yesh Atid, ending his service as a member of the Knesset in the coming weeks.
Cohen is one of the founders of the Yesh Atid party and is set to be replaced by Oz Haim.
Michael Starr contributed to this report.