Scottish Labour leader Wendy Alexander may bring forward a parliamentary bill for a public vote on independence.
She made the threat as she called on the Scottish Government to speed up its plans for a 2010 referendum.
Unionist parties attacked Ms Alexander's stance, while Downing Street distanced itself from the plans.
Scottish Deputy First Minister Nicola Sturgeon said the SNP would not be hurried into changing its timetable for the planned referendum bill.
But Ms Alexander said this would cause uncertainty, as she gave her support to a straight yes/no vote and urged the Holyrood government: "It's time for them to put up or shut up."
She said: "We're in a crazy position where the deputy first minister said she believed there was a majority for independence in the country but apparently she wants to be a unionist for the next three years.
"I personally think that's absurd. If she's convinced she's got a majority, we shouldn't leave it to the fag end of a parliament to get around to testing public opinion."
When asked during a news conference if she had plans to bring forward her own referendum bill, Ms Alexander replied: "That is certainly one of the options that would be available to us."
At Westminster, a senior Labour source described Ms Alexander's call for a referendum as "harebrained".
It followed a "measured meeting" in the Commons of Scottish Labour MPs .
However, several MPs gave their support to her calls, although they admitted it was a high-risk strategy.
Chancellor Alistair Darling - who addressed the meeting - refused to be drawn on his views afterwards.
Group chairman Ann McKechin said there were a "range of views" about Ms Alexander's stance but said that "tactically, what is decided at Holyrood is a matter for Wendy."
Earlier, the prime minister's spokesman, when asked repeatedly whether he supported Ms Alexander's stance, said: "The position taken by the Labour Party leader [Wendy Alexander] is a matter for her."
The spokesman said Mr Brown was confident in the strength of the argument and that any calls for independence would be defeated.
The Scottish Government welcomed Scottish Labour's new position - and said the party now had no choice but to support ministers' plans for their referendum bill.
Ms Sturgeon also said Ms Alexander's comments were a "panic reaction" by a party which was plummeting at the polls.
The deputy first minister told BBC Radio Scotland: "Wendy Alexander's behaviour is erratic in the extreme.
"It's only a few weeks ago she said she was implacably opposed to a referendum, she's just set up a constitutional commission that expressly excludes the option of independence.
"So, who knows what her position will be this time next week, let alone in six months time."
Scottish Liberal Democrat leader Nicol Stephen said Ms Alexander's move was an astonishing u-turn, given her key role in setting up the independent Calman Commission on the future of devolution.
"I don't think anybody knows what Labour stands for anymore," he said.
Annabel Goldie, the Scottish Tory leader, branded the move a "reckless political gamble", adding: "I am a staunch supporter of devolution and refuse to play fast and loose with our future."
Responding to the criticism, Ms Alexander said: "I certainly hope that other opposition parties will reflect on the fact as to whether it is in Scotland's interests to vote down the right of the people in Scotland to choose on this issue."