Up to 300 children could be evacuated from Gaza and given NHS treatment in the UK.
The plans are reportedly set to be announced within weeks.
A parent or guardian will accompany each child, as well as siblings if necessary, and the Home Office will carry out biometric and security checks before travel, the Sunday Times reported.
This will happen “in parallel” with an initiative by Project Pure Hope, a group set up to bring sick and injured Gazan children to the UK privately for treatment.
More than 50,000 children are estimated to have been killed or injured in Gaza since October 2023, according to Unicef.
Sir Keir Starmer said last week that the UK was “urgently accelerating” efforts to bring children over for treatment.
A Government spokesperson said: “We are taking forward plans to evacuate more children from Gaza who require urgent medical care, including bringing them to the UK for specialist treatment where that is the best option for their care.
“We are working at pace to do so as quickly as possible, with further details to be set out in due course.”
The UK and Jordan have been working together to air drop aid amid warnings of widespread malnourishment in Gaza.
It comes as the UK seeks to put pressure on Israel to change course with a plan to recognise a Palestinian state in September ahead of the UN General Assembly.
Sir Keir has said the UK would only refrain from recognising Palestine if Israel allows more aid into Gaza, stops annexing land in the West Bank, agrees to a ceasefire and signs up to a long-term peace process over the next two months.
Concerns have been raised this could see a Palestinian state recognised by the UK without Hamas releasing the remaining Israeli hostages.
British families of hostages say the Government has made clear to them that releases would “play no part” in the UK’s plans to recognise Palestine and that it could see those still held “rot in Hamas dungeons”.
Foreign Secretary David Lammy said the UK’s demands for Hamas to release all hostages and play no role in the future of Gaza are “absolute and unconditional”.
He told The Sunday Times: “The UK position on recognition is part of (a) co-ordinated international effort. It must begin with an immediate ceasefire that frees the hostages and ends the agony of their families, and which lifts the inhumane aid restrictions.”
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