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Among the demonstrators were relatives of the more than 200 people held hostage in the Gaza Strip, whose fate has become increasingly precarious.
“All for all,” protesters chanted outside the Kirya, the army's headquarters in Tel Aviv, holding placards of children taken by Hamas militants during raids into Israel on October 7.
“We’re sick of the slogans. Our loved ones are running out of time,” others cried.
Some protesters held banners calling on Mr Netanyahu to resign. Others lit candles that spelt out the words “guilty” and “shame”.
A similar demonstration took place outside the Jerusalem home of Economy Minister Nir Barkat.
About 20 vigils took place on Saturday evening. The protests came as Mr Netanyahu and his wife met with representatives of hostage families.
Hamas has demanded the release of all Palestinian prisoners in Israel in exchange for the release of Israeli and foreign hostages held in Gaza. Four have been released so far.
The Israeli military has declined the offer, calling it "psychological terror" and said it was working to release the hostages through a number of channels.
Relatives of hostages have called on the Israeli government to agree to the deal as Israel intensified its bombardment of Gaza, where more than 8,000 people, mainly children, have been killed in the last three weeks.
“We are not waiting any longer,” Malki Shem Tov, whose son, Omer, 21, is being held captive in Gaza, told the Associated Press.
“We want all of them back with us today. We want you, the Cabinet, the government, to imagine that these are your children.”
Israeli activists have also called for an immediate ceasefire in the besieged Gaza Strip, which was cut off from contact with the outside world on Friday.
Telephone and internet lines were “gradually” being restored as of Sunday morning, according to the Palestine Telecoms company.
'We choose life'
In the northern town of Caesarea, demonstrators gathered outside the home of Mr Netanyahu on Saturday night after police revoked a ban on protests.
“During the war, holding protests of any kind will be possible in accordance with the law and compliance with the police conditions and of course compliance with the gathering conditions set by the Home Front Command,” the police said.
Anger against the long-time leader and his far-right cabinet, which drew record numbers of protesters to Israel's streets earlier this year, has heightened since the war began.
“We choose life, and therefore demand impeachment now,” organisers wrote on a protest group site before gathering outside the PM's residence, lighting candles and waving Israeli flags.
The prime minister has faced criticism in Israel for not engaging with victims since the war began on October 7.
Mr Netanyahu said at the meeting that his government “will exhaust every possibility” to return hostages and that his promise was not “just lip service”.
On Saturday, he said Israel had entered a “new phase” of its war in Gaza and warned that the fighting ahead would be “long and difficult”.
Defence Minister Yoav Gallant is expected to meet the families of hostages for the first time on Sunday, a day after the Prime Minister agreed to meet relatives.
It came following warnings from the Hostage Families Forum that protests would continue in Tel Aviv if neither Mr Netanyahu nor Mr Gallant meets them.
Israelis awaiting news of their loved ones have increasingly voiced concern as the military steps up its attacks on Gaza.
While it has so far refrained from a full-scale ground invasion anticipated by many, it carried out repeated ground raids into Gaza accompanied by the fiercest aerial attacks yet.