Labour has reportedly said that negotations with the Liberal Democrats are now at a dead end, suggesting that the two parties will now not be entering into a coalition agreement.
The BBC has reported that Number 10 has recognised it is not likely that the talks with the Lib Dems will reach a positive conclusion, and that Labour are saying their side of the discussions is finished.
It comes just 24 hours after Gordon Brown gave his resignation as prime minister, in what some commentators dubbed as a last ditch attempt to secure a power sharing deal between Labour and the Lib Dems.
There has not yet been an official statement from the Labour party.
Up until yesterday it had been thought that the most likely outcome of last week’s general election would be a coalition between the Conservatives and the Lib Dems, though some Lib Dems MPs had expressed concerns that the two parties were not a natural fit.