Merkel's centre-right CDU party and its conservative Bavarian CSU allies are holding separate meetings to weigh the results of last week's European Union summit, which agreed collective measures by the bloc's 28 members to reduce immigration.
Angela Merkel, the German chancellor, was on Sunday night once again fighting for her political future after her interior minister slammed the migration deal she secured with her European Union counterparts last week as "ineffective".
Seehofer's move makes the future of Merkel's government even more uncertain.
Merkel and Seehofer had long battled over the right approach to migration, but seemed to reach an agreement after federal elections last year when the chancellor agreed to try and limit the number of refugees arriving in Germany each year to 200,000 - a policy that Seehofer had repeatedly demanded and Merkel had consistently rejected.
As he entered a CDU crisis meeting Monday, party deputy leader Armin Laschet insisted that the sister parties "want to hold onto" their alliance.
The sources said that in Sunday's private party meeting, Seehofer said he had a "conversation with no effect" with Merkel when they held talks on Saturday about the European Union migration deal, AFP news agency reported.
After weeks of tension stoked by a Bavarian regional party that's threatening to send back more asylum seekers at the border, its leaders are meeting in Munich on Sunday to decide.
Germany's CDU chairwoman Annegret Kramp-Karrenbaur said Ms Merkels party now have a deal that will prevent migrants registered elsewhere from entering Germany.
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Nevertheless, the anti-refugee, anti-Islam Alternative for Germany (AfD) was propelled into federal parliament for the first time past year by outrage over immigration, leading to months of paralysis while Merkel struggled to find a workable coalition.
Patzelt says he doesn't see any solution to the situation unless both of them see reason: "I can hardly imagine any wording of compromise which would avoid one of them losing the face".
Mr Seehofer's CSU has baffled voters and commentators by backing themselves into a tight corner over the migration policy.
Bavaria's Interior Minister Joachim Herrmann, who has been tipped as a potential successor to Mr. Seehofer, said in a radio interview his party wanted an agreement with the CDU but gave no indication about what a compromise could look like. If Seehofer goes ahead with his policies, the dispute could end the decades-old conservative alliance between the CSU and Merkel's CDU.
To politically survive, Merkel could attempt a minority government, seek a new coalition partner in the ecologist Greens or pro-business Free Democrats, or orchestrate a no-confidence vote in parliament that could trigger new elections.
The source of the impasse is a migration plan hatched by Seehofer to take unilateral action to turn back migrants who have been registered first in another European Union country.
He said the two parties should be aware that the far-right Alternative for Germany, which has soared in prominence since a wave of migrants fleeing conflict and poverty headed to Germany in the summer of 2015, stood ready to benefit from a meltdown of the conservatives. "I would like very much for the CDU and CSU to continue working together", she added.
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