Commons leader Jack Straw has said an inquiry into the Iraq war will be held "in due course".
MPs have long pushed for an inquiry
The government has been under pressure to hold a full-scale inquiry into all aspects of the war.
Downing Street said it was "not the time" to have an inquiry while British troops were in the country.
The Tories said one was needed this year before "memories" faded, while the Lib Dems said it should be held while relevant ministers remained in office.
Last year the government managed to defeat a cross-party bid to force an immediate inquiry.
Mr Straw, speaking at a lunch for political journalists in Westminster, insisted there was no difference between his position and what Prime Minister Tony Blair had said previously.
He added: "There are possibly occasions when members of the Cabinet end up in different places, but this isn't one of them."
Mr Blair's official spokesman said: "The PM has said there will come a time when people will want to look at this issue but now is not the time when our troops are on the ground."
The Conservatives, who backed the Iraq war, favour an investigation similar to the Franks inquiry carried out after the Falklands war, involving former generals and civil servants rather than just MPs.
Shadow foreign secretary William Hague said Mr Straw's statement was a "welcome U-turn" by the government.
"It is vital to learn from the many mistakes that have been made," he said.
"Such an inquiry needs to be established this year, before memories of events in 2002 and 2003 start to fade."
Liberal Democrat leader Sir Menzies Campbell also said it was crucial to have an inquiry now.
"The appropriate moment is while the relevant ministers are still in office and the applicable MPs are still in parliament.
"An inquiry which proves only to have historical value will not do. A contemporary investigation is what we need."
The Scottish National Party and Plaid Cymru have tried to force an inquiry into the decision-making process that led to the Iraq war.
There has already been the Butler report into intelligence failings and the Hutton inquiry into the death of weapons expert Dr David Kelly.
In July 2003, the foreign affairs select committee also published a report into Iraq weapons claims.
Mr Blair announced on Wednesday a withdrawal of troops from Iraq, with 1,600 due to return by April, while 5,500 stay till 2008.