At least 30 Conservative lawmakers believe the party should rethink Theresa May’s "no deal is better than a bad deal”, according to Sky News.
The economic impact of a "cliff-edge" Brexit and the failure of the Conservatives to win a majority in the General Election is said to have rattled Mrs May’s party.
Some business leaders fear that Mrs May's insistence that "no deal is better than a bad deal" will cost them business in the European Union, and finance minister Philip Hammond has now re-emerged as big business' leading proponent.
Brexit Secretary David Davis and his EU counterpart Michel Barnier began divorce talks on Monday
A former minister told Sky News that "no deal is now dead" and added that a transition phase of five to 10 years inside the European Economic Area is now likely.
Some senior Conservatives believing they can stop the Government leaving the EU without a deal, according to the BBC.
Nicholas Watt, Newsnight’s political editor, said: "They want to discourage the Government from the going down the no deal route by saying we in Parliament could complicate Brexit by effective obliging minister to go back to the EU to ask for an extension to the Article 50 negotiations.
"Westminster now has a very different feel with a minority Government.”
He added: ”If such a scenario [of no deal] is looming, they would have the numbers to pass an amendment to the [EU] repeal bill.
"That amendment would very simply they say, cancel the repeal of 1972 European Communities Act which provide lawful basis for our accession into the EEC [European Economic Community] which then became the EU.”
Mrs May is eight seats short of a majority in Parliament as Brexit talks began on Monday.
But the Prime Minister is set to announce her policy plans later today without an arrangement giving her Government enough support to pass legislation.
She will need the support of Northern Ireland's Democratic Unionist Party (DUP), which is expected to use its 10 votes to back her in exchange for a series of agreements.