The M25 motorway could be widened into an eight-lane highway, it is reported.
The M25 is Britain's busiest road
The scheme to widen the key road around London could start within four years and cost £1.7bn, the Financial Times says.
Transport Secretary Alistair Darling is due to address the House of Commons on about road building on Wednesday.
A Department for Transport spokesman described the newspaper report as speculation and told BBC News Online no details would be released ahead of Mr Darling's speech.
Some stretches of the M25 - Britain's busiest road - already have eight lanes.
The widening of other parts of the motorway could be completed by 2012, the Financial Times says.
The government's study into road usage around London, called Orbit, began in 2000.
A proposal to introduce road user charges for a huge swathe of southern England was shelved by the South East England Regional Assembly last year.
The proposal said charges should be brought in for roads within a 50-mile radius of London to solve motorway congestion.
But the assembly said there were "serious concerns" about the charging plan.
The Orbit study also suggested 50 miles of the 120-mile M25 should be widened to four lanes.
But it said this should only go ahead if charges were introduced for motorists using roads within the 50-mile radius.
It added that if such charges were ruled out, motorists should pay a toll of 3p a mile to travel on the widened stretches.
A spokesman for the RAC Foundation said the organisation would welcome any plans to widen the M25.
He said: "While waiting to see what is in the announcement on Wednesday, it looks very
positive in making sure that the M25 doesn't remain as one of the biggest car parks in Europe.
"If something is not done then we are going to be in a dire situation for years to come."
But environmental campaigners reacted angrily to the report.
A Friends of the Earth spokesman said: "The government pledge to get people to use their cars less and public transport more is now a hollow promise."