The move has been led by Namibia, which is currently representing the Non-Aligned Movement (NAM) members on the council, and is supported by Jamaica, Malaysia, Bangladesh, Mali and Tunisia.
They say that the sanctions should be removed since Tripoli has co-operated fully with the trial of the two men accused of the 1988 bombing of Pan Am Flight 103 over Lockerbie, Scotland.
However, both Britain and the United States have made it clear that they would oppose the resolution until the trial of the Libyan suspects has ended.
UK and US oppose lifting sanctions
"The requirement to co-operate with the trial lasts all the way through the trial because there may be other witnesses and other actions to be taken that need Libyan co-operation," British Ambassador Sir Jeremy Greenstock said.
An air and arms embargo and a ban on some oil equipment, were imposed in 1992 and 1993 to force Libya to hand over for trial Abdel Basset al-Megrahi and Al-Amin Khalifa Fahima.
They stand accused of killing all 259 people aboard the Boeing 747, as well as 11 people on the ground.
The sanctions were suspended in April 1999 after the two accused were extradited to face a Scottish court sitting in the Netherlands.
Sanctions carry no weight
In practice, the sanctions have no validity as they cannot be reimposed without another vote by the Security Council.
The Namibian ambassador, Martin Andjaba, had originally intended to put the measure to the vote on Friday, but he said that this is now unlikely.
The council president, Russian Ambassador Sergey Lavrov, said he would schedule more consultations for Friday morning.