A Muslim traffic warden resigned because he complained he was unable to wear the symbol from any other faith.
The Sunday Times reports that the force has come under pressure from a threatened employment tribunal resulting from the case.
Currently all officers in Britain's 51 police areas wear the badge which incorporates the St Edward's crown, topped with a Christian cross.
Choice
Now the Met is proposing to develop an alternative badge for people who do not want to sport the traditional one.
In a statement, the Met said it had long "cherished" its association with the Crown.
However, its future depended on its "ability to attract and maintain the most talented people and cater for their individual needs and requirements".
It proposes that all employees will still be issued with the traditional badges "as a matter of course" but if they object - with supportable reasons - they will be offered a badge without the crown.
The initiative could be adopted nationwide after the Met's deputy commissioner Ian Blair discusses the issue with the Association of Chief Police Officers.
Traditionalists have rejected the idea.
Inspector Glenn Smyth, chairman of the Metropolitan Police Federation, told the Sunday Times: "Uniform should be exactly what the word means - it should apply to everyone.
"We swear an oath of allegiance to the Queen. The crown is the symbol of that oath and this move attacks its meaning."
Tony Arbour, a Conservative member of the Greater London Authority, said it was political correctness "going mad".