Rae said Wednesday he'll decide by the end of this month whether to try turning his gig as interim leader into a permanent job.
When Rae took on the interim post a year ago, the party's national executive made him promise he wouldn't use it as a launching pad to run for permanent leader.
But there's been a change in membership on the executive since then and current members are widely expected to release Rae from that commitment during a tentatively scheduled conference call on the evening of June 13.
"It's an overwhelming consensus of the membership of the Liberal party that he ought to be able to run," said Nova Scotia MP Scott Brison, calling the original prohibition against Rae "dumb" and "regrettable."
Rae said it's up to the executive to make an independent decision, after which he'll decide whether to take the plunge. As he's done all along, he declined to tip his hand.
"How stupid do you think I am?" he joked as reporters tried to lure him into weighing the odds of a Rae candidacy.
However, Rae did make it clear he won't keep Liberals guessing about his intentions for long if, as expected, he's allowed to run.
"There will be a decision before the end of the session, I'm sure, one way or the other."
The parliamentary session is scheduled to wrap up on June 22.
There are very few Liberals who believe Rae won't run. Indeed, there have been signs that his campaign is already in gear, with at least one organizer, Toronto MP Jim Karygiannis, signing up supporters among ethnic communities across the country.
Still, other prospective candidates have been reluctant to make any final decisions about running until they know for sure whether Rae, a formidable contender who'd immediately be deemed the presumptive front-runner, will be in the race.
"Obviously, anybody who's a candidate is curious to see who's going to be in the race," said Montreal MP Marc Garneau, who is reflecting on his own potential candidacy.
"So for me to say, 'Oh, (Rae's decision has) got nothing to do with it,' would be disingenuous. I do want to see what the field looks like."
Rae ran third in the 2006 Liberal leadership race. He briefly threw his hat in the ring in 2008 but withdrew early after it became clear the party had rigged the rules to ensure a coronation for Michael Ignatieff, Rae's one-time college roommate.
Ignatieff resigned last May after leading the party to its worst election showing in history. The once mighty, self-styled natural governing party was reduced to a third party rump with only 34 seats, surpassed by the ascendant NDP.
Rae's performance as interim leader has undoubtedly bolstered his chances of winning this time.
"Mr. Rae's done a tremendous job for us," said Toronto MP Judy Sgro. "Let's be honest about it. It's been a tough year and Bob's experience and leadership and calmness has been good for our morale."
Still, there is a strong faction of Liberals who are dead-set against Rae, many of whom believe he simply carries too much baggage from his single turbulent term as NDP premier of a recession-ravaged Ontario during the early 1990s.
They are desperately hoping a strong contender will emerge who can beat him. Some are pressuring Montreal MP Justin Trudeau — the rock star of Liberals with the iconic name — to rethink his decision to stay out of the fray.
Trudeau, who wants to devote time to his two young children, acknowledged in an interview that he's under a lot of pressure to change his mind.
"Yep, but I was born under a lot of pressure, wasn't I?"
He added: "I haven't changed my mind."
Among the tiny group of Liberals who managed to get re-elected last year, only Garneau, Ottawa MP David McGuinty, Vancouver MP Joyce Murray and New Brunswick MP Dominic LeBlanc are considering a leadership bid.
Beyond them, a host of defeated MPs and failed Liberal candidates — including Gerard Kennedy, Martha Hall Findlay, Mark Holland, Borys Wrzesnewskyj, Martin Cauchon, Deborah Coyne and David Bertschi — are mulling over their chances.
Bertschi, a lawyer who ran unsuccessfully for the party last year in the riding Ottawa-Orleans, has gone so far as to form an "exploratory committee" and has been criss-crossing the country meeting Liberals.
Many Liberals would love to see a star "outsider" emerge as a contender, floating the names of dream candidates like Quebec Justice Minister Jean-Marc Fournier or Bank of Canada governor Mark Carney or Calgary Mayor Naheed Nenshi — none of whom has expressed any interest in the job.
The only so-called outsider to show interest thus far is Toronto lawyer George Takach.
Should Rae take the plunge, the Liberal caucus will have to choose a new interim leader to carry them through to the leadership convention, which is to be held some time between March 1 to June 30, 2013. The executive is expected next week to provide more precision about the timing of the convention.
That will put some pressure on Garneau and LeBlanc, both of whom are touted as possible interim leaders, to make a quick decision on whether to run for permanent leader.
"If I choose not to go (into the race), I would probably consider throwing my name in the hat to be interim leader, yeah," said Garneau, who serves as Liberal House leader.
Brison has also been touted for the interim post but he said he's given no thought to the idea. Trudeau's name has also come up for the interim job but he outright laughed at the idea.
"I'd make a terrible interim leader," he said. "My strengths are outside of the House, not inside the House."