Rail operator Govia Thameslink faces being stripped of its franchises unless performance on its services in the South East of England rapidly improves, the BBC understands.
A source said the government could begin the process within weeks.
Passengers on its Thameslink and Great Northern trains have
endured more than a month of disruption following the introduction of new timetables in May.
Meanwhile, commuters are to set receive compensation worth a month's travel.
Govia Thameslink Railway (GTR) - which also runs Southern and the Gatwick Express services - changed the time of every train on its timetable on 20 May.
Passengers were warned of disruption before the changes were brought in, but the implementation of the new timetable saw some services withdrawn and further cancellations without any warning.
Since then, GTR chief executive Charles Horton has resigned and Transport Secretary Chris Grayling has faced calls to stand down - as
MPs from across all parties voiced their concern at the disruption caused in their constituencies