Gordon Brown is to offer MPs a vote on holding a referendum to scrap the first-past-the-post electoral system in favour of the alternative vote.
He announced the move in a speech to the Institute for Public Policy Research in London today, with the vote taking place as early as next week.
The measure is to be included as amendments to the Constitutional Reform and Governance Bill, currently going through Parliament.
If passed the referendum would take place in the next Parliament, following the general election expected on May 6.
It had been widely believed that the plans had been pushed down the agenda, after a Bill to introduce electoral reform was cut from November's Queen's speech.
Brown first floated the possibliity of scrapping the first-past-the-post system in his speech to the Labour PArty conferene in Septmeber 2009.
The surprise move on electoral reform comes as a poll shows the Conservative lead over Labour has been cut to seven points, raising the prospect of a hung Parliament.
The ComRes survey for The Independent put the Tories on 38 per cent (unchanged), Labour on 31 per cent, (up two points), the Liberal Democrats on 19 per cent and other parties on 12 per cent (down two).
The paper claims this would leave David Cameron 24 seats short of an overall majority if repeated in the general election.
The announcement may be seen as an attempt to capitalise on the narrowing polls by wooing Liberal Democrat voters, who traditionally strongly favour electoral reform, although alternative vote is not the proportional system that the party favours.
Alternative vote is favoured by many reformers as it maintains the link between constituencies and single members of Parliament, unlike many propositional systems which require the creation of larger multi-member constituencies.
Under the AV system voters still elect one person to represent them in Parliament, but rather than marking an 'X' against their preferred candidate, they rank candidates in order of preference.
If a candidate receives a majority of first votes they are elected. But if no candidate secures more than 50 per cent of the vote, the second choices for the candidate who polled in last place are redistributed amongst the others.
The process is repeated until one candidate gets an absolute majority.
Brown also confirmed that a draft Bill to create a democratically accountable House of Lords will be published within the next few weeks.
And Brown said that as part of moves towards the creation of a written constitution he had Cabinet Secretary Sir Gus O'Donnell asked codify the unwritten rules governing the operation of central government.
Dods Parliamentary Communications Ltd