The Fire Brigades Union (FBU) chief, Andy Gilchrist, said ministers intervened in the middle of the night to block an offer that could have seen the strike suspended.
The local employers negotiating the deal rang the deputy prime minister at 3am today to get approval for a settlement, but were told that the government could not accept it without seeing the small print.
This morning, an irate Mr Prescott admitted that local employers had telephoned him in the middle of the night, but they had been unable to say how much the deal would cost.
"It would be like signing a bouncing cheque," said the deputy prime minister.
Instead, he said he wanted a postponement of the strike until his office could read the documentation this morning.
With the eight-day stoppage now under way, Mr Prescott is still insisting that any pay increase must be linked to modernisation of the service.
Mr Prescott - a former militant trade union leader himself - is now facing the prospect of becoming a scapegoat within government for failing to prevent the potentially damaging strike. Mr Blair is known to be keen to take on the FBU, going as far as to describe Mr Gilchrist as a "Scargillite", but with public opinion so far behind the strikers, the deputy prime minister is likely to be the lightning rod for any criticism of the Labour administration.
Mr Prescott's deputy, Nick Raynsford, who has responsibility for local government and is part of the government's negotiating team, is also likely to take some flak.
Earlier, Mr Gilchrist attacked what he said was government intervention.
"The executive council of my union had been prepared and had decided to suspend the eight-day strike to talk further on the employer proposal to settle this current pay dispute," he said.
"But I have to say the pattern of government intervention has continued for the third time and again, when a chance of peace was at least possible, the government has intervened to block that offer."
But Mr Prescott told BBC Radio 4's Today programme: "The only intervention is phone calls to me throughout the night. I did not ring them."
He insisted he still had not seen the proposed deal, although he thought one of his officials might have received a copy.
Meanwhile, the Conservative leader, Iain Duncan Smith, said there was "no reason" for firefighters to strike.
It was wrong to put lives a risk in a pay dispute, Mr Duncan Smith told the Today programme.
"The government has got to make a decision about what it can afford, and then it's got to stick to that. I'm not going to quibble about that," he said.
The Tory leader was critical, however, of what he said was confusion in the government's handling of the dispute.
Ministers had sent mixed messages when a 16% rise was first suggested in the summer, he argued.
Mr Duncan Smith said that more work should have been done earlier in training troops to use modern "red" fire engines - and he demanded to know whether the government was considering taking legal action to try to block the strike.
Mr Prescott said later there was no need for anyone to cross picket lines, as 120 modern fire engines were already available for military use.
It was for the armed services to decide whether to use them, he said.
