Mr Benjamin Netanyahu is expected to turn down the post of Israeli foreign minister, in what would be a blow to Prime Minister Ariel Sharon's efforts to put together a narrow right-wing coalition.
"He is not enthused at the prospect of playing second fiddle to Sharon," said a confidant of Mr Netanyahu, a former premier and Mr Sharon's main rival in the ruling rightist Likud party.
Mr Sharon offered Mr Netanyahu the post yesterday and they were due to meet again tomorrow, after the Jewish Sabbath.
The government crisis was triggered by a dispute over funding for Jewish settlements in the occupied territories which led to a walkout by Foreign Minister Shimon Peres and other ministers of the Labour Party, Likud's coalition partner.
Mr Netanyahu (53) has played a high-profile part in defending Israel's handling of the two-year-old Palestinian uprising abroad, and would be a popular foreign minister.
"At this difficult time for the state of Israel, during which Mr Netanyahu's communication skills could contribute enormously to Israel's information campaign in the world, he was offered the post pure-heartedly," Mr Sharon's bureau director, Mr Dov Weisglas, told Israeli Army Radio.
Mr Netanyahu was expected to take a decision after meeting Mr Sharon tomorrow, Mr Weisglas added.
Mr Netanyahu wants to replace Mr Sharon as prime minister rather than be his subordinate, but turning down the foreign ministry could split a party still reeling from the Labour walkout and scrambling to stay in power.
Mr Sharon, 74 years old and mired in the worst political crisis since he took power in 2001, stands to gain either way.
Mr Sharon has offered the key defence portfolio to Mr Shaul Mofaz - a former army chief remembered for designing Israel's tough countermeasures to the Palestinian revolt - replacing Labour leader Mr Binyamin Ben-Eliezer.
Mr Sharon was also due to meet ultranationalist parties on tomorrow in a bid to shore up his government, which lost its parliamentary majority when Labour quit on Wednesday.