The leaders of Fianna Fail and Fine Gael have agreed a framework document for a coalition government.
Micheal Martin and Leo Varadkar reached agreement on Tuesday after weeks of talks between various parties.
The two parliamentary parties will be briefed on it on Wednesday ahead of engagement with other potential coalition partners.
The two parties along with Sinn Fein finished in an almost dead heat following the general election in February, and with none close to the 80-seat threshold to form a government.
Even with agreement between Fine Gael and Fianna Fail, the parties are seven seats short and will require the backing of other parties who could potentially bridge the gap.
The Greens, Social Democrats and Labour have all been mooted as potential junior partners.
Fianna Fail and Fine Gael have repeatedly ruled out going into government with Sinn Fein.
In a joint statement, Fianna Fail and Fine Gael said: “Both leaders met this morning and agreed the framework document.
“Both leaders will brief their respective Parliamentary Parties tomorrow.”