* Government could have a case against ed-PM Najib "in short while"
* Differences between Mahathir, 92, and Anwar, 70, over forming cabinet
* Mahathir, Anwar turn from friends to foes to allies
New Malaysian Prime Minister Mahathir Mohamad said on Tuesday he will remain in office for one or two years and that Anwar Ibrahim, the jailed reformist he had vowed would replace him, will be released on Wednesday.
Mahathir, 92, said he thought that "in a short while" the government could have a case against his predecessor, Najib Razak, who has been dogged by a multi-billion-dollar scandal at state fund 1Malaysia Development Berhad (1MDB).
A four-party alliance driven by Mahathir and Anwar won the general election last week, ousting the ruling Barisan Nasional coalition for the first time in the history of the Southeast Asian nation. Mahathir was sworn in as prime minister on Thursday, making him the world's oldest democratically elected leader.
In "an initial stage, maybe lasting one or two years, I will be the prime minister", Mahathir said, speaking by live video link from Kuala Lumpur to a Wall Street Journal CEO conference in Tokyo.
"I will play a role in the background even when I step down."
The pardons board in Malaysia's capital will meet on Wednesday to discuss Anwar's release and Mahathir said he would be released the same day.
Anwar, 70, is serving a second five-year jail term for sodomy. He and his supporters have said the charges are politically motivated.
A royal pardon would reverse Anwar's conviction and make him eligible to actively participate in politics. He has been in hospital for a few months recovering from a shoulder operation.
During the campaign, Mahathir, who was prime minister for 22 years in a previous stint from 1981, promised to step aside and make Anwar prime minister once he was pardoned.
But there have been differences between the two over the cabinet formation, and Mahathir made it clear on Tuesday that he was in charge.
"I expect him to play the same role as the leaders of the other three parties. There will be no special powers given except as are given to ministers or deputy ministers or deputy prime ministers," Mahathir said. He added that he would make the final decision about cabinet posts.
Mahathir has named just three ministers so far in addition to himself and Anwar's wife, Wan Azizah Wan Ismail, as deputy prime minister.
Anwar's People's Justice Party (PKR), which has the most seats in the alliance, is demanding a proportionate number of posts in the cabinet.
The volatile relationship between Anwar and Mahathir, from friends to foes to allies, has dominated Malaysia's political landscape for more than three decades and is central to the future of the alliance.
When Mahathir was prime minister in the 1990s, Anwar was his deputy and clear heir-apparent.
But in 1998, they disagreed on how to tackle the Asian financial crisis and fell out. Anwar was sacked, and he launched a 'Reformasi' (reform) movement to end the ruling alliance's race- and patronage-based government that brought tens of thousands of supporters on to the streets.
Faced with a leadership challenge, Mahathir used internal security laws to detain more than 100 opposition politicians, academics and social activists. He jailed his former deputy on charges of sodomy and corruption.
Anwar was freed in 2004 but in 2015, he was jailed again - for five years - for sodomising a former aide, a charge he and his supporters describe as a politically motivated attempt by Najib to end his career.
In an astonishing U-turn last year, Anwar shook hands with Mahathir and agreed to join forces to oust scandal-tainted Najib.
Mahathir vowed on Monday to investigate any faults that may have been committed by Najib's government and said all ministries had been instructed not to destroy any documents.
Asked if Najib would go to prison, he said: "It all depends on the investigation being made and whether there is a case against him or not. If there is no case, we do not go for detention without trial."
News broke in 2015 that about $700mn allegedly stolen from 1MDB had made its way into Najib's personal bank accounts. Najib has said the deposit was a donation by an unnamed member of the Saudi royal family which had been largely returned.
Najib set up 1MDB in 2009 and previously served as chairman of its advisory board. He and the fund have denied wrongdoing.
Mahathir blocked Najib from leaving the country at the weekend.