Business Secretary Lord Mandelson says the government will do all it can to save Corus steel plant on Teesside.
On his first visit to the Redcar site, where 1,600 people face losing their jobs, he told workers the government was "fully behind" them.
The plant is to be partially mothballed on Friday after efforts to find a buyer failed.
Union leaders have attacked the decision to mothball the Indian-owned Teesside Cast Products facility.
After meeting union representatives, Corus management and Redcar Labour MP Vera Baird on Thursday, Lord Mandelson said: "Politically, we are not going to walk away from this plant. We stand full square behind it.
"We will do everything we can to bring it out of mothballing and back into production as everyone around here wants to see.
"The reason it is not yet a tragedy is because it is not yet a closure of this plant. This plant will be maintained, its ability to reopen and resume operation will be protected by the company, and I have that assurance from them."
Prime Minister Gordon Brown said the government was "desperately looking" for new investment in Corus.
Before a meeting of the Cabinet in Durham, he said: "I understand the frustration that people feel. There are wonderful workers at Corus.
"This is a good company, this is not a company that should be going under, but we have a problem."
He blamed falling global demand for steel, decreasing prices, and in particular the international consortium which pulled out of a 10-year deal to buy the Redcar plant's output.
Mr Brown said: "We are trying desperately to find new investors for the future. We are talking to a number of investors about the future of Corus."
Corus has confirming it will start to partially mothball the steelworks on Friday.
Michael Leahy, leader of the Community trade union, accused Indian parent company Tata Steel of stonewalling potential buyers.
He said: "Tata Corus are signing the death warrant for a more than 100-year tradition of steelmaking on Teesside."
A company spokesman said: "Corus's position remains unchanged. This is a mothballing, not a permanent closure. TCP will be kept ready for a restart. Corus remains open to credible offers for TCP."