Fianna Fáil confirmed this evening it had made contact with the Green Party with a view to forming a coalition government.
In a statement, Fianna Fáil said contact had been made "with a view to an early exchange of policy position papers and documents with a view to establishing the extent to which our respective policy approaches have a basis for further discussion".
Taoiseach Bertie Ahern has indicated that his preferred coalition option would involve the Progressive Democrats and a group of Independents.
But with six seats the Green Party offers Fianna Fáil a potentially more stable option. The Green Party said tonight it was considering "all related matters and will respond over the coming days".
Earlier the president of the Progressive Democrats said his party - which returned only two TDs - had an opportunity to be involved in a Fianna Fáil-led government if the "proper terms" can be agreed.
Tom Parlon, one of the six Progressive Democrat TDs who lost their Dáil seats in the election, confirmed both Fianna Fáil and Fine Gael had contacted the party.
However, he appeared to rule out the option of going into government with Fine Gael.
Asked on RTÉ's Morning Irelandprogramme whether the two remaining PD deputies wanted to go into government with Fianna Fáil, Mr Parlon said: "It's not about what we want to do at this stage. It's the opportunity that is there. There is an opportunity for the PDs to be involved in the next Fianna Fáil government if the proper terms can be negotiated.
"I understand the Taoiseach contacted Mary Harney personally. They're only a phone call away from each other, and they're in regular contact. Whenever the time is right I'm sure they will sit down and work out whatever details . . . or whether that can be done or not."
While Fine Gael had "made a phone call", Mr Parlon said he did not personally see "any major follow-up" to that. He said a deal involving the Green Party was also "a real possibility".
Mr Parlon added: "But that obviously has to be negotiated. From some of the soundings I've heard from the Greens and their conditions and so on, there would appear to be quite a bit of work to be done to work out that deal. But anything is possible in politics, as I've learned in my short enough career in politics."
He said the view in his party on the current hearings at the Mahon tribunal, which is examining issues relating to the Taoiseach's finances in the 1990s, was that the tribunal should be allowed to do its work.
"Let whatever comes out at the tribunal come out. I think people are wasted listening to leaks and speculation about the tribunal. Let the tribunal do its business," he said.
Mr Parlon said it was acknowledged at a meeting of party members yesterday that mistakes had been made in the election campaign but that the members still felt the party has a future.
"There was no attempt made yesterday to cover up the fact that we have had a disastrous election, and we have lost six of our seats, and our leader and deputy leader and president have all lost their seats, so that was fully accepted. I think all of us as individuals have come to terms with that over the last couple of days."
Mr Parlon said there was "a very strong determination" that the party should continue. It had made a "major impact" on Irish society in the 20 years since its foundation, he said.
However, he said the image of the party and of some of the individuals in it had been "portrayed as a very harsh one and very right wing and selfish even.
"That certainly is a perception that has got out there and that has been used against us very strongly and certainly hasn't helped us," he said.
He said the polarisation of the vote between Fianna Fáil and Fine Gael had also been a problem for the PDs in the election. The Progressive Democrats' "niche" policies on tax and economics had been "stolen by everyone", he said.
The Progressive Democrats lost six of their eight seats in last Thursday's election and are now left with Mary Harney and Noel Grealish in the Dáil. Following the loss of his own seat in Dublin South East, Tánaiste and PD leader Michael McDowell said he was leaving public life.
Mr Parlon, who lost the seat in Laois-Offaly that he won in the 2002 election, said he was personally committed to staying with the party and that he had enjoyed a "very lucky, very charmed" career.
He said the question of being appointed to the Seanad was "pure speculation" but it was something he would certainly consider as it would be a "big honour".