The House of Lords is set to debate a bill that would allow a referendum on the UK's membership of the EU in 2017.
PM David Cameron has already pledged to hold a referendum in 2017 if the Tories win the next election. The bill, introduced by Tory MP James Wharton, would write the pledge into law.
The bill passed its final stage in the Commons in November despite Labour and Lib Dem efforts to delay its passage.
It is likely to face a tougher time in the Lords, where it could be derailed.
Labour, Lib Dem and pro-European Conservatives are expected to work together to amend the bill.
It would then need to clear the Commons again by the end of February and could run out of Parliamentary time.
'Blunt instrument'The government could then take the unusual step of using the Parliament Act to force it on to the statute books.
But despite David Cameron's backing for the bill - part of efforts to prove he is serious about holding a referendum - he may opt not to take such a step.
Debate on the bill is expected to start shortly after 10:00 GMT.
Lord Dobbs, the Conservative peer who is spearheading the bill's passage through the Lords, told Radio 4's Today programme that Europe had become a "pestilence in our political system" and "we need to get rid of this burden".
"Nobody below the age of 60 has ever had a chance to have a say on this issue," he said.
"We need to decide one way or another whether we are going to stick with Europe or leave."
But Labour peer and former European Commissioner Lord Mandelson said the threat of British exit would "diminish not enhance to get much-needed reforms in Europe".
"A referendum is a very blunt instrument that needs to be handled with great care," he told the same programme.
"Membership of the European Union is absolutely fundamental to British interests."
James Wharton has acknowledged his bill would have a tougher time in the upper house but said: "For an unelected house to deny the British people a say on a bill which has been passed by the elected House of Commons, I think, would put them in a very difficult position."
It is unlikely there will be a vote in the Lords later, but the debate will set the scene for divisions to come.
Both the prime minister's deputy Nick Clegg and Labour leader Ed Miliband have warned of the uncertainty and damage to business they say would be caused by holding a referendum.
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