Premier Jeremy Rockliff is expected to visit the state's governor on Wednesday to request that a state election be held.
Mr Rockliff had met with his cabinet over Tuesday morning to discuss, among other things, the prospect of going to the polls early.
He met with the wider parliamentary Liberal party shortly after that.
In a short statement issued after both meetings, Mr Rockliff said:
"The Parliamentary Liberal Party this afternoon met to discuss the failure of former Liberal MPs John Tucker and Lara Alexander to commit to a new, enduring confidence and supply agreement.
"It was unanimously agreed that in the light of this, it was appropriate for me to request the governor to call a general election.
"The only way to restore the stability and certainty Tasmanians need is to re-elect a majority Liberal government."
Although a date has not been confirmed, it is speculated that election day will be on March 23 to allow for a five-week campaign.
There had been rumblings that a state election could potentially be held at any time after the Liberals went into minority midway through last year after the defection of former government backbenchers Lara Alexander and John Tucker.
The pair in May struck an agreement with the premier shortly after which guaranteed that they would not support a no-confidence vote in the government, nor block the budget.
Mr Tucker in the first few days of this year threatened to bring down the government if two demands of his were not satisfied: one involved a motion on surveillance activities in Tasmanian abattoirs and the other for progress to be halted on a high-performance training centre linked the proposed Macquarie Point stadium.
This prompted Mr Rockliff to attempt to negotiate a new deal with Mrs Alexander and Mr Tucker, which would have prevented them from supporting any bill, bill amendments or motions from Labor, the Greens and other independents.
These terms were rejected by the pair who wished to stick to the original agreement.
The next state election was due to be held in 2025 at June 28 at the latest.
Labor leader Rebecca White said the premier had dithered over two weeks before making a call on an early election.
"Following seven months of telling Tasmanians there would be no early election, Jeremy Rockliff has finally come clean about his true intentions," she said.
Greens leader Rosalie Woodruff said it was a second term in a row for the Liberals where an early election had been called.
"So much for 'stable majority government'," she said.
This will be the first election since 1996 where the state will be required to elect 35 members after a bill to expand the lower house to its original size passed in 2022.
This will be the first election that Mr Rockliff will fight as leader for the Liberals and it will the party's attempt at a fourth term in office.
This will be Labor leader Rebecca White's third election campaign as leader of the party.