Angela Eagle is poised to launch a bid for the Labour leadership if Jeremy Corbyn refuses to resign.
The former shadow business secretary is seen as a ‘unity’ candidate, who could bring together the left and right of the party.
But she could face opposition from other Labour MPs making the same pitch.
Mr Corbyn’s woes multiplied yesterday (TUE) as more members of his frontbench team walked out.
READ MORE: Scottish Labour leader Kezia Dugdale urges Jeremy Corbyn to resign
He also dramatically and overwhelmingly lost a vote of no confidence among his own MPs.
In the aftermath of the vote Scottish Labour leader Kezia Dugdale became the latest senior figure to call on him to go.
But the veteran socialist insisted that he would not resign.
He said he would not "betray" his supporters and hit back at the vote among MPs, saying that it had no "constitutional legitimacy" under Labour party rules.
In a statement, he said: "I was democratically elected leader of our party for a new kind of politics by 60 per cent of Labour members and supporters, and I will not betray them by resigning.
"(This) vote by MPs has no constitutional legitimacy.
"We are a democratic party, with a clear constitution.
"Our people need Labour party members, trade unionists and MPs to unite behind my leadership at a critical time for our country."
Mr Corbyn lost the vote 172 to 40.
READ MORE: Scottish Labour leader Kezia Dugdale urges Jeremy Corbyn to resign
He also spent the day struggling to put together a new shadow cabinet.
There was still no shadow Scottish Secretary in place 36 hours after Edinburgh MP Ian Murray resigned.
The loss of the only Labour MP north of the Border left Labour scrabbling around for a replacement to take on the Scotland brief.
More resignations are expected later today.
There were also suggestions that some MPs were considering a boycott of PMQs, in a bid to embarrass the party leadership.
Ms Dugdale told the BBC: "If I lost the confidence of 80 per cent of my parliamentary colleagues I could not do my job".
She added: "My primary focus as leader of the Scottish Labour party is on the impact of Brexit on jobs and the Scottish economy, and what support I can offer the Scottish Government on that basis.
"However, I would have to accept that, despite my own mandate of 72 per cent from the party membership, if the overwhelming majority of Labour MSPs did not support my leadership I would not be able to do this job effectively.
"Jeremy and I were elected leader of the UK and Scottish parties at similar times with similar mandates. We both have a job of uniting our parliamentary party to be an effective opposition and ultimately a party of government.
"I would not be able to do my job if I did not have the support of the parliamentary party, regardless of the mandate that members give me. Jeremy should reflect on the outcome of the PLP vote but I would not carry on in similar circumstances"
READ MORE: Scottish Labour leader Kezia Dugdale urges Jeremy Corbyn to resign
Ms Eagle was one of the stars of the EU referendum television debates.
She famously told Boris Johnson to his face to “get that lie off your bus”, a reference to the claim, now disowned by a number of Leave campaigners, that there would be £350m a year for the NHS after Brexit.
She is tipped as a potential ‘unity’ candidate, able to appeal to both the left and the right of her party.
A former minister, who served in the Treasury under Gordon Brown, she is also seen as a safe pair of hands who impressed when she stood in for Mr Corbyn at Prime Minister’s Questions.
Labour’s deputy leader Tom Watson, who is close to the unions, is also considered pivotal to what happens over the next few days.
Labour MPs are furious with their leader, who they accuse of running a half-hearted campaign to keep the UK in the EU.
Last week millions of Labour voters, particularly in the party's traditional heartlands, rejected its message to vote Remain.
Insiders are terrified they could now face a Scottish-style wipeout of Labour MPs in the north of England if there is a snap general election.
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