The British Foreign Secretary, Mr Jack Straw said this morning that the government was planning a meeting between the Prime Minister, Mr Tony Blair and Libyan leader Colonel Muammar Gaddafi.
"We've discussed that, we are hoping very much that a visit can be arranged as soon as convenient but no date has yet been fixed," Mr Straw told a news conference after landmark talks with his Libyan counterpart Mr Mohamed Abderrhmane Chalgam.
Mr Chalgam is the first Libyan foreign minister to come to Britain since 1969, the year Mr Muammar Gaddafi took power in a bloodless coup.
London has called the visit a "milestone" in steadily improving relations, following Libya's surprise declaration in December that it would abandon plans to develop weapons of mass destruction, including atomic weapons.
Talks with Mr Blair and the Foreign Secretary Mr Jack Straw have centred on ways to bring Libya back into the "international mainstream," London has said, including improving cooperation on terrorism and helping Libya implement economic reforms.
Britain also hopes to make progress in resolving the case of the 1984 killing of British policewoman Yvonne Fletcher, who was shot outside the Libyan embassy in London during a protest.
Gunfire appeared to come from the embassy but Libya has failed to cooperate fully with the inquiry, officials have said.
The government played a key diplomatic role in securing December's weapons agreement, which has given a huge boost to Libya's efforts to end its international isolation.
Libya has long been listed by the United States as a sponsor of terrorism, and suffered United Nations sanctions until last year for the 1988 bombing of an airliner over Lockerbie, Scotland, which killed 270 people.
But London and Washington have been moving rapidly to bring Tripoli back in from the cold in past months.
Last year, Libya paid $2.7 billion (1.45 billion pounds) in compensation to Lockerbie victims, before agreeing to dismantle its weapons programmes.
Britain has moved faster than the United States to restore ties. Washington has yet to lift economic sanctions, including a ban on travel by U.S. citizens to Libya. Those sanctions are keeping lucrative oil deals on ice.
But after three-way talks in London last week, U.S. officials said Washington might soon lift restrictions on travel to Libya if Tripoli continued to make progress on the pledge to halt weapons programmes.
Easing those sanctions could allow American oil companies to resume activities in Libya, which they had to abandon when expanded U.S. sanctions forced them to pull out in 1986.