The Daily Mirror has learned of a plot involving disillusioned MPs, peers and union bosses.
It would be the first such move against the Premier since he swept to power in 1997. One ringleader said: "These are firm proposals."
The Labour MP, who asked not to be named, added: "We have the numbers required to mount a challenge.
"It is now a firm view right across the Labour Party that Tony Blair is finished because of his refusal to listen to overwhelming opposition to war with Iraq."
Our source said: "I will not speculate on who will be asked to front this challenge.