The president had earlier arranged a meeting with parliamentary leaders after accusing Viktor Yanukovich, the prime minister and his chief rival, of attempting to expand the parliamentary majority by illegally recruiting MP's loyal to him.

The Interfax news agency quoted a source in the Kremlin as saying Yushchenko had asked Vladimir Putin, the Russian president, to postpone talks between the two men scheduled for Tuesday in Moscow.

Power eroded

Yushchenko swept to power on the back of the "Orange Revolution" in 2004, a popular movement that rejected Russian interference in Ukranian politics.

But since the victory Yushchenko has seen his power-base eroded by Yanukovich, the man he defeated in 2004 and who he was forced to appoint as prime minister in August.

At the beginning of Moday's talks he threatened to dissolve parliament and call an election unless the coalition abandoned its "anti-constitutional" actions of persuading individual opposition members to join its ranks.

"In essence, the country is in the grip of a constitutional imbalance," Yushchenko told participants as the talks opened.

Yushchenko's dissolution of parliament will please the tens of thousands of protesters who rallied in Kiev at the weekend to back calls by opposition leader Yulia Tymoshenko, a former prime minister, for the president to go.

Hundreds of protesters backing the prime minister have set up a camp in a park outside parliament.

Tymoshenko was fired as Yushchenko's first prime minister within eight months after her government split into competing factions.

She and other opposition leaders say new elections are needed as the expanded coalition no longer reflects how people voted in the previous election held last year.