File Photo: Former Israeli Prime Minister Benjamin Netanyahu, center, prays with his sons Avner Netanyahu, right, and Yair Netanyahu at the Western Wall, the holiest site where Jews can pray in Jerusalem s Old City, Jan. 22, 2013. AP
The latest bombshell from business daily Calcalist alleged that Pegasus was used against a son of former premier Benjamin Netanyahu, activists, senior government officials, businessmen and others.
Calcalist had previously alleged that the controversial malware, which can turn a phone into a pocket spying device, was used by police against leaders of an anti-Netanyahu protest movement.
Hours after Monday's report emerged, Bennett promised that his government "won't leave this without a response.
"Things allegedly happened here that are very serious," he said in a statement that also credited Pegasus as "an important tool in the fight against terrorism and severe crime".
"But they were not intended to be used in phishing campaigns targeting the Israeli public or officials - which is why we need to understand exactly what happened."
As Bennett pledged action, Minister for Public Security Omer Barlev said he would ask the justice ministry to authorise a government commission of inquiry.
Barlev said that, if approved, the probe would be led by a retired judge who would question anyone necessary in the political, legal and security system to uncover "violations of civil rights and privacy".
Pegasus is a malware product made by the Israeli firm NSO at the centre of a months-long international scandal following revelations that it was used by governments worldwide to spy on activists, politicians, journalists and even heads of state.
Israel had come under fire for allowing the export of the invasive technology to states with poor human rights records, but the Calcalist reports have unleashed a domestic outrage.
President Isaac Herzog suggested the credibility of key Israeli institutions was at stake.
"We must not lose our democracy. We must not lose our police. And we must certainly not lose public trust in them. This requires an in-depth and thorough investigation," Herzog said in response to the Calcalist report.
Calcalist said dozens of people were targeted who were not suspected of any criminal conduct, and without police receiving the necessary court approval.
They include senior leaders of the finance, justice and communication ministries, supermarket magnate Rami Levy, mayors, and Ethiopian-Israelis who led protests against alleged police misconduct.
In another revelation set to rock Netanyahu's ongoing corruption trial, Calcalist also reported that key witness Ilan Yeshua, former chief executive of the Walla news site, was a target.
Avner Netanyahu, one of the premier's sons, was also on the list. "I truly am shocked," he wrote on Facebook.
Netanyahu is accused of seeking to trade regulatory favours with media moguls in exchange for favourable coverage, including on Walla. He denies the charges.
His lawyers on Monday demanded the trial be halted until the latest revelations were probed.
The trial also suffered a blow last week when multiple Israeli broadcasters reported that police may have used spyware on Shlomo Filber, a former Netanyahu ally turned state witness.
Those reports, which Netanyahu described as an "earthquake", did not mention Pegasus.
Pegasus is a surveillance program that can switch on a phone's camera or microphone and harvest its data.
NSO has consistently denied wrongdoing throughout the multi-stranded Pegasus scandal, stressing that it does not operate the system once sold to clients and has no access to any of the data collected.