Tzipi Livni, formerly Israel's Foreign Minister, was elected Prime Minister. She has three months to assemble a working coalition, or new elections will be held. Since she's been active in the peace talks up to this point, we can expect a continued focus on that issue. She was profiled by the Times magazine last year … I can imagine that article will get a lot of hits in the next couple of days.
Correction: Livni was elected head of the Kadima party; if she puts together a majority coalition, then she can become Prime Minister. Olmert will remain a caretaker PM until a ruling coalition is formed.