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Representatives from the UK and EU have approved the draft text of an agreement on Brexit after months of negotiations.
A cabinet source told the BBC that the document had been agreed at a technical level by officials on both sides after intensive discussions this week.
A special cabinet meeting will be held Wednesday at 14:00 GMT, while Theresa May will seek the support of ministers.
The Prime Minister met with ministers at Downing Street for individual talks on the draft agreement.
The pound sterling jumped against the dollar and the euro as a result of the breakthrough – but analysts warned that it could be short-lived, with the cabinet and parliament having not yet accepted the plans.
The EU has announced that it "would take stock" on Wednesday, while the Irish government said the negotiations were "under way and have not succeeded".
Prominent Brexiteers, such as Boris Johnson and Jacob Rees-Mogg, immediately criticized the draft agreement that would have been maintained, saying the UK would remain under EU control.
The Democratic Unionist Party of Northern Ireland, which provides vital support to Theresa May in key votes, said it would be "very, very difficult to sell".
But the Conservative Chief Whip, Julian Smith, said he was "confident" that he would be adopted if he was subject to a crucial vote in the House of Commons. Transportation Secretary Chris Grayling called for "a little calm" before the cabinet comes out on Wednesday.
The United Kingdom and the EU hope to hold a special summit of European leaders in late November to sign the agreement.
What was agreed?
The details of the preliminary agreement have not been published, so we do not yet know the fine print.
But it is composed of a withdrawal agreement – supposedly 500 pages in length – and a declaration on the future relationship between the UK and the EU.
The withdrawal agreement includes how to ensure that physical checks at borders will not be reintroduced in Northern Ireland – the main stumbling block in recent weeks.
Some Brexite specialists fear that this arrangement will keep the UK in the EU's trade rules for years to maintain a frictionless border.
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The agreement also includes commitments on citizens' rights after Brexit, a proposal for a 21-month transition period after the departure of the UK on March 29, 2019 and details on the "Divorce Bill" ", worth 39 billion pounds.
The future relationship statement is expected to be much shorter, as the long-term trade agreements of the UK and the EU remain unresolved.
N ° 10 stated that the ministers were now convened to an extraordinary meeting to "discuss the draft agreement reached by the negotiating teams in Brussels and to decide on next steps".
Before doing so, they will be able to read the relevant "documentation".
Getting started
By BBC political editor Laura Kuenssberg
The agreement is finally within reach of number 10.
The text that took months of blood, sweat and tears to the officials was approved, at least at the technical level.
A paper is currently in preparation to be presented to the Cabinet tomorrow, ready for the next step expected by the government – the political approval of Theresa May's team, although many of them have to deep reserves.
Do not forget that "in the last 24 hours, some of them have privately warned that what is on the table is simply not acceptable and that". it will never be adopted by Parliament. Some even think that the Prime Minister should withdraw.
But the government machine is now moving to action. With a ready text, their long-planned rollout can begin.
Who does not like that?
Former Foreign Secretary Johnson said that the United Kingdom would remain in the customs union and would constitute "large parts" of the single market.
He told the BBC that it was "absolutely unacceptable to anyone who believes in democracy" and that he would vote against it.
Mr Rees-Mogg warned that the UK would become a "vassal state", with Northern Ireland "being governed from Dublin".
Jeremy Corbyn, leader of the Labor Party, said: "Given the chaotic nature of the negotiations, it is unlikely to be a good deal for the country."
The pro-EU conservative MEP Justine Greening said the deal would leave the UK with less influence and undermine its credibility.
Speaking at a rally calling for the holding of another European referendum, she said: "Even if some members of my party can not see that it's a bad deal , everyone around the planet can. "
The view of the EU
Katya Adler, editor-in-chief of BBC Europe
Brussels keeps schtum tonight. This does not mean nothing happens. Connoisseurs prefer simply to remain silent at this delicate stage.
It seems that what is described for me as a "mutual understanding" has actually been reached technically between Brexit negotiators from the EU and the UK.
This is not yet an agreement. All eyes are now on the British cabinet. If the ministers reject the project, it comes back to the drawing board.
If they approve it, the European Commission can inform the 27 EU ambassadors who will meet tomorrow that decisive progress has been made in the negotiations, which means that a summit on Brexit could be convened with Theresa May, probably in less than two weeks.
First of all, the 27 EU countries and the European Parliament will want to look at the text. And it will not be with a non-critical eye.
In the meantime, following pressure from all sides of the House of Commons, Ministers agreed to provide Members with a legal assessment of the implications for the United Kingdom of Irish support and other controversial aspects of any agreement.
Cabinet Office Minister David Lidington said Attorney General Geoffrey Cox would make a statement to MPs and answer questions before the final vote on any Brexit deal.
MEPs, he said, will have access to "a comprehensive statement of principle outlining the government's political and legal position on the proposed withdrawal agreement".