Latest polls have shown Netanyahu's Likud party trailing the centrist Zionist Union by about four seats.
The numbers do not necessarily rule out Netanyahu's chances of forming the next government after Tuesday's election but have rattled Likud, which began the campaign all but assured that it would stay in office.
In recent days it has been on a get-out-the-vote blitz with Netanyahu warning against the rise of a left-wing government in a series of interviews and before tens of thousands of hard-line supporters at a Tel Aviv rally on Sunday evening.
"This is a fateful struggle, a close struggle. We must close this gap. We can close this gap," Netanyahu said to roaring applause at the rally.
His centrist rival, Isaac Herzog, has been surging in the polls on a campaign that promises to repair ties with the Palestinians and the international community and also bring relief to the country's struggling middle class.
Neither side is expected to get more than a quarter of the votes so the election will likely be followed by a lengthy period of negotiations over the next coalition government.
A potential kingmaker could be found in the new centrist party of Moshe Kahlon, who is running on an economic platform that deals almost exclusively with bread-and-butter issues while putting Israel's diplomatic challenges on the back burner.
Kahlon is demanding to become finance minister in the next government and could tip the scales in favour of either Netanyahu or Herzog. The son of Libyan immigrants, Kahlon is popular with working class Israelis thanks to his Middle Eastern background, his modest upbringing and for reforming the local mobile-phone market.