David Cameron is reported to have ruled out withdrawal from the European Convention on Human Rights despite the opposition of Justice Secretary Michael Gove and Home Secretary Theresa May.
The two ministers argued that pulling out of the convention was the "only solution" to re-establishing the supremacy of the British courts over the Strasbourg-based European Court of Human Rights, according to the Daily Telegraph.
However they are said to have been overruled by the Prime Minister who concluded that Britain should remain a signatory to the convention while scrapping the Human Rights Act (HRA) which enshrines the convention in UK law.
The Telegraph quoted a senior Government source as saying: "Withdrawal is not going to happen. Michael Gove and Theresa May think it's the only solution but David Cameron's clear this is off the table.
"The British bill of rights could mitigate the worst excesses of the Human Rights Act but it won't change the fundamentals."
The decision puts Mr Cameron at odds with two of his most senior cabinet colleagues on one of the most politically sensitive issues facing the new Government.
The disclosure comes just days after it was announced in the Queen's Speech that plans set out in the Conservative general election manifesto to replace the HRA with a British bill of rights had been put on hold for at least a year.
The delay comes amid concerns the Government would face a protracted struggle to pass the legislation both in the Commons, where it faces significant opposition from rebel Tory MPs, and the Lords where it has no majority.
The prospect that Britain could withdraw from the convention was raised by Mr Gove's predecessor as justice secretary, Chris Grayling, in a Conservative policy paper last year.
It said the rulings of the Strasbourg court should no longer be binding on the British courts and proposed leaving the convention altogether if the Government was unable to negotiate a looser relationship.
However the proposal that the UK should withdraw if ministers were unable to achieve a satisfactory outcome was not included in the party's general election manifesto.
A Downing Street spokesman said: "The Government's policy is as set out in the manifesto and that is shared by Theresa May, the Prime Minister and the whole Cabinet."
The suggestion that withdrawal is now off the agenda will prove highly controversial among Conservative MPs - many of whom strongly believe that the British courts must be supreme.
Backbencher Philip Davies told the Daily Telegraph: "It is very disappointing. The European Court of Human Rights is full of pseudo judges, most of whom are political appointees.
"The convention has become a charter for illegal immigrants to avoid deportation and for criminals to pursue vexatious claims. I have no idea why we would want to stay part of that."