The postponement was reportedly due to infighting in the prime minister's Likud party and disagreements over cabinet appointees, according to Reuters.
The swearing-in had been delayed once already, due to Secretary of State Mike Pompeo’s visit on Wednesday.
Despite criticism, the unity government is a coalition agreement between current Prime Minister Netanyahu and once-rival Gantz, who is a member of the Blue and White.
Under the new agreement, Netanyahu will serve as prime minister for 18 months, and then Gantz will serve as prime minister for the following 18 months.
This agreement was reached after three parliamentary elections resulted in stalemates.
Netanyahu, the longest-serving prime minister in Israeli history, has been indicted in three criminal cases of corruption. He has denied each charge and is set to go on trial later this month.
Gantz, a former chief military officer, ran his political campaign vowing not to serve under Netanyahu, later arguing it was necessary to team up with the prime minister in order to unite the country under the coronavirus pandemic and to avoid a fourth parliamentary election.
Gantz will become Israel’s defense minister while he awaits his turn to serve as prime minister. Critics of the new unity government object to Netanyahu still holding office even after his prime minister seat is up.
Under the agreement, Netanyahu is allowed to remain prime minster through his trial, which is set to begin May 24. And he is able to push forward with his proposed annexation of the West Bank.
The agreement also states that annexation must be done in coordination with the United States and certain peace agreements must be followed.
Netanyahu plans to start initiating the annexation of the West Bank and Jordan Valley on July 1.
The Associated Press contributed to this report.