Halutz has been widely criticised for not achieving Israel's war aims
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Israeli military chief of staff, Lt Gen Dan Halutz, has publicly admitted to failings in the conflict with Hezbollah militants in Lebanon.
In a letter to troops, he said it had exposed shortcomings in the military's logistics, operations and command.
There would be a thorough and honest investigation, he promised.
Meanwhile, the head of Israel's security service Shin Bet accused the government of abandoning residents of northern Israel during the conflict.
And Israeli citizens have been protesting outside Jerusalem's parliament building over the handling of the conflict, some calling for senior officials to resign.
Stock portfolio
Apart from his conduct of the war, Gen Halutz has faced criticism for selling his entire stock market portfolio hours before the outbreak of fighting in Lebanon.
He has denied any wrongdoing.
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COST OF CONFLICT
Lebanon deaths:
About 1,000 - mostly civilians
No precise data on Hezbollah dead
Israeli deaths:
Soldiers: 116
Civilians: 43
Lebanon displaced:
700,000 - 900,000 (UNHCR; Lebanese govt)
Israeli displaced:
500,000 (Human Rights Watch)
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"We have to proceed to a meaningful examination of the successes and the errors, "Gen Halutz said in his letter.
"We have to extract professional lessons, as we are faced with more challenges... This test concerns us all, from me down to the last soldier."
The Israeli army lost 116 soldiers. Forty-three civilians were also killed by more than 4,000 Hezbollah rocket attacks.
About 1,000 Lebanese were killed in the conflict, mostly civilians in Israel's vast bombardment of the county and land invasion in the south.
The conflict was sparked by a cross-border raid by Hezbollah fighters in which they captured two Israeli soldiers and killed eight others.
Throughout the military campaign against Lebanon, Israel's twin aims were the return of the captured Israeli soldiers and the removal of Hezbollah's influence from southern Lebanon.
Critics and opposition figures have said that neither of these aims has been achieved.
In a separate development, Shin Bet chief Yuval Diskin told a closed security forum that government systems in northern Israel had "completely collapsed" during the Hezbollah rocket attacks.
Prime Minister Ehud Olmert has promised more than $2bn to rebuild the towns worst affected in northern Israel.
Independent inquiry call
Mr Olmert is expected to announce in the next few days a decision on whether to hold a full state commission into the conflict.
A state commissions were ordered after the 1973 Yom Kippur War, a conflict in which the Israeli military was widely perceived to have underperformed.
Meanwhile, Defence Minister Amir Peretz has set up a ministerial inquiry to investigate how the military campaign in Lebanon was conducted.
The inquiry, headed by retired Israeli army chief Amnon Lipkin-Shahak, has already started work and is expected to produce an interim report within weeks.
Opposition politicians have called for an independent commission, not one appointed by Mr Peretz.
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