He has previously stated his intention of legalising the trade, however, there has been widespread opposition.
Opposition includes Orthodox coalition partners and Jewish and Arab opposition legislators.
The Independent has reported that Mr Netanyahu has appointed a committee to explore possibilities for opening up to four casinos in the southern resort of Eilat.
The Israeli tourism minister Yariv Levin and the prime minister say that casinos will pull the region out of an economic slump, caused partly by a lack of tourism.
Around 80% of the labour force in Eilat works in the tourism industry, according to the ministry.
Tourism ministry spokesperson Anat Sichor used an the example of Asian gambling hub Macau.
She said: "We're not anxious to have gambling itself but with proper inspection and limitations we can succeed like other cities in the world where casinos benefited them."
It is being argued that casinos would lead to more hotel rooms, conference rooms and spas, meaning more visitors.
In a statement, the prime minister's office said casinos would create thousands of jobs.
Netanyahu also stressed that his friend and benefactor, US casino magnate Sheldon Adelson, who sponsors a pro-Netanyahu free tabloid, Yisrael Hayom, is not interested in operations in Israel.
Mr Netanyahu would need the plans passed and does not look like he will get a majority.
Both the Jewish conservatives and Arab groups are opposed to the plans and raised concerns about gambling additions.
Mr Bennett, also an education minister, said to The Independent: "Casinos are not the solution. They are the problem.
"How can we educate a generation of children that the way to attain things is through hard work, effort and creativity and not looking for the easy way when their father goes to the casino at night?
"We won't gamble with the future of our children. Israel is not, and will not be, Vegas."
