The Knesset is the legislature or parliament of the State of Israel; the Hebrew term knesset means 'assembly'. The first Knesset was elected on 20 January 1949 and first met on 14 February the same year. It is a unicameral (single chamber) body and has 120 elected members. The present Knesset building in Jerusalem was inaugurated in 1966.
Voters in Israel vote for a party, not an individual candidate. Each party's leadership decides who will potentially be members (this is known as a "closed party list") and in which order (the top candidate would hold the office of Prime Minister, or hold a major Cabinet position such as Foreign Minister as part of a governing coalition).
The seats are allocated to the parties based on the D'Hondt method of party list proportional representation. Parties can form electoral alliances with other parties to obtain more seats under the D'Hondt method (and this is quite common, the two ultra-orthodox Jewish Haredi parties have run as United Torah Judaism since 1992, while the four main Arabic parties frequently run under the name Joint List), furthermore parties not in a formal alliance can create an agreement to create an alliance to gain "leftover seats" (a feature of the Israeli election system, in 2015 Likud and The Jewish Home agreed to such an alliance, among others). A party or electoral alliance must pass the election threshold of 3.25% of the overall vote to be allocated a Knesset seat.
Once seats are awarded the parties use the closed list to determine who will be seated. For alliances the member parties decide ahead of time how to allocate seats between them.
Due to the multi-party system in Israel, only one time since the state's founding has any party won at least 61 seats to run the government outright. Usually a coalition is needed. The President of Israel decides which party has the best opportunity to form a coalition government; it does not have to be the party with the most seats won (this was the case in 2009, Kadima won the most seats but Likud was given the chance to form the government which it did) and that party is given 42 days to do so (extensions may be granted and often are). Parties may later join the governing coalition if they wish and this is often done.
Under law the Knesset will sit for four years unless it is dissolved on a vote of no confidence. This is often the case as the coalitions ultimately fall apart due to differences between the parties. In those cases an attempt may be made to create a new coalition; if not successful the Knesset dissolves and early elections are called.