The Italian President, Giorgio Napolitano, is expected to dissolve parliament, paving the way for early elections, reports say.
Franco Marini threw in the towel on forming a government on Monday
Mr Napolitano met the speakers of both houses of parliament on Tuesday in the first step towards calling elections.
Senate speaker Franco Marini had held unsuccessful talks to form an interim government to reform electoral laws.
By law, the president has to call an election within 70 days of dissolving parliament.
Former Prime Minister Romano Prodi is expected to co-sign a decree dissolving parliament on Wednesday, Italy's ANSA news agency reported.
The centre-left leader resigned as Italian prime minister two weeks ago following a no-confidence vote.
The previous right-wing Prime Minister, Silvio Berlusconi, had rejected any possibility of an interim government, calling for early elections in April.
Mr Berlusconi, who framed the existing system and is ahead in opinion polls, said only early elections could end the political crisis sparked by the collapse of Mr Prodi's centre-left government last month.
Silvio Berlusconi thinks he can beat the centre-left bloc again
According to opinion polls, Mr Berlusconi would win both houses under the current rules.
Mr Marini held a final round of consultations earlier this week with Walter Veltroni, head of the centre-left Democratic Party, before reporting back to President Napolitano.
But the senate speaker said afterwards that he could not raise enough support for an interim government to change voting rules which have been blamed for much of Italy's political instability.
Under the current system, implemented by Mr Berlusconi during his time as prime minister, smaller parties with only a handful of seats hold the balance of power in parliament.
Mr Berlusconi has said he is willing to negotiate on electoral reform, but only after the country has been to the polls.
Last month, the loss of the support of the small centrist Udeur party in the Senate left Mr Prodi's coalition without a majority and requiring the support of several unelected life senators.
In a subsequent confidence vote, Mr Prodi's government fell four votes short of the 160 it needed to survive.