Britain and Ireland could reach agreement within hours on how to run their post-Brexit Irish land border, paving the way for a deal that would remove the last obstacle to opening free trade talks with the European Union.
A spokesman for the EU executive says Britain and the European Commission are making progress on Brexit proposals and will continue to work "throughout the night".
Commission President Jean-Claude Juncker spoke to Irish Prime Minister Leo Varadkar and then his British counterpart Theresa May, EU spokesman Margaritis Schinas wrote on Twitter.
"We are making progress but not yet fully there. Talks are continuing throughout the night," he wrote on Thursday, adding that an early morning meeting was possible.
"Tonight more than ever, stay tuned," he added.
"Discussions about taking forward the Brexit process are ongoing," a British government spokesman said, adding that May had also telephoned with Varadkar.
The Irish border has emerged as one of the toughest unresolved issues in the negotiations.
A carefully choreographed attempt to showcase the progress of Brexit talks collapsed at the last minute on December 4 when the Northern Irish party which props up May's government vetoed a draft deal already agreed with Ireland.
Since then, May has been scrambling to clinch a deal on the new UK-EU land border in Ireland that is acceptable to the European Union, Dublin, her own lawmakers and Northern Ireland's Democratic Unionist Party, which keeps her government in power.
May and European Commission President Jean-Claude Juncker could meet early on Friday to seal a border deal, the European Commission's chief spokesman said.