JERUSALEM — Under an ethics cloud and facing the possible collapse of his governing coalition, Prime Minister Olmert yesterday cleared the way for his party to hold early primaries that could end his political career.

The move may keep his government together in the short term. But it also could mean that his Kadima party will choose a successor later this summer as a way of easing him out of power.

Also yesterday, Mr. Olmert and his top security officials postponed a decision to authorize an Israeli military invasion of the Gaza Strip, choosing instead to allow Egyptian-mediated truce talks with the radical Islamist group Hamas to continue.

Mr. Olmert has been under increasing pressure to step down since reports surfaced last month that he had received more than $150,000 from an American businessman, much of it in cash. Although the money was ostensibly meant for campaign expenses, the businessman, Morris Talansky, testified that he believed Mr. Olmert had used some of the money to fund a lavish lifestyle.

Mr. Olmert told two top party leaders yesterday that they could go ahead with preparations for holding a primary, even though one is not due until 2010. Mr. Olmert had earlier opposed the idea of an early primary.

“No date has been set for primaries, but the process of discussion has begun,” an Olmert spokesman, Mark Regev, said. He said Mr. Olmert had not made a decision on whether he would compete. The selection of a new chief for Kadima would effectively end Mr. Olmert’s premiership.

Mr. Talansky is expected to take the stand again next month, when he is cross-examined by Mr. Olmert’s attorneys, and his aides are hoping that the second round of questioning leaves the prime minister in a better light. Mr. Olmert has denied any wrongdoing in the case, but has said he will resign if he is indicted.

Late last month, the leader of Mr. Olmert’s coalition partner, Defense Minister Ehud Barak, had threatened to pull his support unless Kadima picked a new party leader. Mr. Barak’s Labor party had also expressed initial support for a move to dissolve parliament that is expected to come up for a vote next week. By allowing the primary process to start, Mr. Olmert may have kept Labor in line for now.