German Interior Minister Horst Seehofer offered his resignation to party colleagues late on Sunday, party officials said, escalating a row over migration with Chancellor Angela Merkel that threatens her fragile government.
The German leader was forced into a corner last month when Mr Seehofer threatened to defy her wishes and order police to turn back asylum seekers unless she secured a broader European Union deal on distributing migrants more evenly.
Should Seehofer resign and his party withdrawal from the coalition, it would spell the collapse of Merkel's government.
This would leave Merkel and her remaining coalition partner the Social Democrats (SPD) with a minority in the parliament - something she could bridge by courting support from opposition parties for legislation or finding an additional coalition partner.
CDU general secretary Annegret Kramp-Karrenbauer said in Berlin party leaders were "united" behind "effective, humane solutions together with our European partners".
But by Sunday evening it was looking as though she had bested one of her harshest critics on migration, Horst Seehofer, the head of Merkel's Bavarian sister party, the Christian Social Union, and her current interior minister.
She said she would wait and see what the leadership of the two parties decides "and then we will see what comes next, step for step".
Seehofer has threatened to turn away certain categories of asylum-seekers at the country's borders, while Merkel insists on a solution that involves other European countries.
At the national level, Merkel proposes that migrants arriving in Germany who first registered in another European Union country should be placed in special "admission centres" under restrictive conditions, according to a document she sent to the CSU and SPD.
This was a direct contradiction of Merkel's account of the meeting, which she delivered in an interview with public broadcaster ZDF on Sunday.More news: Real Madrid next? Courtois drops big Chelsea split hint
It was not yet clear what effect Mr Seehofer's resignation might have.
Merkel, who has been in office since 2005, warned last week the battle over migration could decide the EU's future.
Supporters of German AfD wave flags in front of the Brandenburg Gate in Berlin, Germany, Sunday, May 27, 2018.
Amid the increasing tensions, Merkel and the rest of the European Union leaders hammered out on Friday a vaguely-worded deal to share out refugees on a voluntary basis and create "controlled centres" inside the bloc to process asylum requests.
The quarrel threatens to derail Germany's fragile coalition and the 70-year-old alliance of CDU and CSU.
The CSU will face a state election in Bavaria in October and has opted to take a firm stance against immigration as part of its campaign.
Officials from the Bavaria-based CSU accused Merkel of rejecting several compromise proposals made by Seehofer to heal the rift with her own CDU.
Merkel, now barely 100 days into her fourth term, faced a backlash from the conservative CSU after allowing more than one million asylum-seekers into Germany since 2015.
If he orders border police to go ahead with the scheme in defiance of the chancellor, Merkel would be forced to fire him, in turn prompting a CSU walkout that would cost her majority in parliament.
Weeks of "Merkel-bashing", however, have failed to help the CSU, as a Forsa poll last week showed around 68 percent of Bavarians backed Merkel's quest for a Europe-wide answer to migration rather than Germany going it alone.