German Chancellor Gerhard Schroeder plans to hold a confidence vote in parliament by 1 July - the first step in forcing an early general election.
Schroeder's government has been dogged by high unemployment
If his government loses the vote, parliament will be dissolved and elections held by mid-September.
The move, announced by the chairman of his Social Democrat Party, comes after they lost a key regional election.
Mr Schroeder said the defeat in North Rhine-Westphalia had undermined the government's programme of reform.
"The bitter result... jeopardises the political basis for the continuation of our task," Mr Schroeder said.
"I think that, for the reforms to be pursued, the majority of Germans must clearly back them now."
Social Democrat Party Chairman Franz Muentefering announced the date for the planned confidence vote on Monday.
If parliament brings down Mr Schroeder's government, German President Horst Koehler will have 21 days to dissolve parliament. After that, new elections must be held within 60 days.
Early elections in Germany are highly unusual. But a similar tactic was adopted by Mr Schroeder's predecessor Helmut Kohl, who forced elections in 1983 by calling a confidence vote in which his supporters abstained.
The Social Democrats (SPD) had governed in North Rhine-Westphalia for 39 years before their defeat by the Christian Democrats (CDU).
CDU leader Angela Merkel said the voters had given her party "a sensational result".
Ms Merkel is likely to challenge Mr Schroeder and she may now have a good chance of becoming Germany's first female chancellor. Her party enjoys a strong lead in national opinion polls.
"It comes down to a single question," Ms Merkel was quoted as saying on Monday by Reuters news agency.
"Who do the people trust to make Germany strong once again? On this question, we are very confident."
High unemployment was a key factor in the SDP defeat in North Rhine-Westphalia.
With five million unemployed across Germany as a whole, analysts say the general election may turn on the same issue.