The head of the Kenyan government team at crisis talks has expressed anger with mediator Kofi Annan over comments on resolving the election dispute.
Ms Karua said the comments had caused her team embarrassment
Mr Annan hinted that both sides had agreed on a transitional government for two years, after which fresh presidential elections would be held.
But Justice Minister Martha Karua said this had never been discussed.
She said that Mr Annan, the former UN chief, had undermined the government's position at the negotiations.
Some 1,000 people are thought to have died in the violence that followed the disputed polls results.
More than 600,000 people have been forced to flee their homes amid clashes between rival ethnic groups, seen as pro-government or pro-opposition.
When talks between government and opposition teams were moved away from the capital, Nairobi, on Tuesday to a secret location to avoid the glare of publicity, Mr Annan asked both sides not to discuss the contents of the talks with anyone else, calling for a complete news blackout.
His comments about a possible grand coalition were made during a special closed-door session with Kenyan MPs.
But details of his briefing have angered President Mwai Kibaki's negotiating team.
Ms Karua said his statement about a transitional government had caused distress and great embarrassment to them as it had misrepresented their position.
"We feel these inaccuracies have greatly undermined our position as members of the dialogue team and we demand the issue be revisited as the first item when we meet next," she said.
A power-sharing deal had been thought to be imminent, but correspondents say this development implies the government is against fresh elections.
In a statement on Wednesday, mediators sought to downplay the rift, saying the grand coalition was Mr Annan's perspective on the discussions.
"[It] does not imply a formal agreement between the two parties," the statement says.
Both the opposition Orange Democratic Movement (ODM) and President Mwai Kibaki's Party of National Unity (PNU) have tabled proposals for a power-sharing agreement at the talks.
Mr Annan had hinted the deal would include comprehensive constitutional, judicial and electoral reforms.
He told parliament both President Kibaki and Mr Odinga are committed to the talks aimed at reconciling the nation and urged the MPs to equally support the process.
"Your active involvement, across party lines, is necessary. Without this, the government may be paralysed. We cannot afford to fail," he said.