Prime Minister David Cameron wants to use "flexibility" in the honours system to ensure the achievements of Britain's Olympic and Paralympic heroes are properly recognised, Downing Street has said.
No formal announcement has been made, but it is understood that a separate list will be drawn up for those involved in the London 2012 Games so there is no limit on the number of honours handed out.
The possibility is being considered of a special one-off list for announcement in the weeks after the conclusion of the Paralympic Games this weekend, though it is thought more likely that awards will be made alongside the usual New Year Honours list at the end of the year.
In normal years, the number of gongs granted to recognise achievement in different areas of endeavour is limited by guidelines to awarding committees. Although there is no strict quota, the committee which draws up recommendations for sporting honours, chaired by London 2012 supremo Lord Coe, is asked to put forward around one name for a knighthood, four for CBEs, 20 for OBEs and 38 for MBEs.
Ministers recognise this will not be adequate to reflect a year in which the nation has been captivated by the triumphs of Olympic and Paralympic champions. One source said on Thursday night: "They will be dealt with separately, as it has been an exceptional year."
With Team GB scooping 29 Olympic golds and the Paralympics squad so far totting up more than 100 medals - including 31 golds - there are expectations of a slew of honours.
Popular Olympic champions such as Bradley Wiggins, Jessica Ennis and Mo Farah, as well as Paralympians Ellie Simmonds and Sarah Storey - who brought her lifetime tally of golds to a record-equalling 11 on Thursday - could be recognised.
Some of those responsible for organising the Games could also be rewarded for what has been globally recognised as an exceptionally smoothly run event.
Speaking at a regular daily press briefing in Westminster on Friday morning, Mr Cameron's official spokesman stressed that no announcement had been made. But he added: "The Prime Minister is very keen that there should be recognition of those who have contributed to a very successful Olympics and Paralympics. There are guidelines, but there is flexibility within the system."
A spokesman for the Cabinet Office, which operates the honours system, said: "This is proving to be a great summer for British sport. The honours system recognises those who make exceptional contributions to this country and all awards are made on merit. Honours are usually awarded in the New Year and Queen's Birthday list."