Spain's government has said it will suspend Catalonia's political autonomy and impose direct rule from Madrid, as the crisis engulfing the country deepens.
The central government said on Thursday it would trigger article 155 of the constitution, allowing it to suspend the region's autonomy.
:: What invoking article 155 means for Catalonia
The announcement came after Catalan leader Carles Puigdemont said his parliament could vote on a formal declaration of independence if Spain continued to refuse to hold talks.
Mr Puigdemont ignored a Thursday deadline to drop the independence bid, issuing a letter that demanded further dialogue just minutes before the 10am cutoff imposed by Spanish Prime Minister Mariano Rajoy.
"If the government continues to impede dialogue and continues with the repression, the Catalan parliament could proceed, if it is considered opportune, to vote on a formal declaration of independence," it said.
Activating article 155 is an unprecedented step for the Spanish government, and an emergency cabinet meeting scheduled for Saturday will discuss what the move will involve.
"The government will use all the tools available to restore as soon as possible the law and the constitutional order, recover peaceful cohabitation between citizens and stop the economic damage that the legal uncertainty is creating," a spokesperson said.
Catalan leadership has been locked in a standoff with Spain following a 1 October referendum in which 90% of voters backed independence, but just 43% of the eligible population cast a ballot.
In the subsequent weeks Mr Puigdemont did not commit to a formal declaration, calling instead for further dialogue with Spain.
But Mr Rajoy's government deemed the referendum unconstitutional and refused to recognise it, threatening to suspend Catalan autonomy if the region pressed ahead with independence.
Teresa Freixes, an expert in Spanish constitutional law, told Sky News that article 155 allows the government flexibility over what suspending autonomy might mean.
"One possible option is that someone substitutes for the Catalan government, authorities named by the central government, and it could be that they dissolve the Catalan parliament to call fresh elections," she said.
Widespread brutality against voters, that injured 900 people on the day of the referendum, has heightened concerns over an authoritarian approach by the Spanish government.
The crisis, over a region with a population of 7.5 million and which contributed 19% of Spain's GDP in 2016, has prompted the state to cut its growth forecasts and has rattled the Euro.