Livni, 50, who is also the country's foreign minister, had made attempts to reach political agreements with other parties since being elected leader of the Kadima last month. She took over from Ehud Olmert, who resigned amid accusations of corruption.
"I'm not willing to be blackmailed, either diplomatically or in terms of the budget, and therefore, I will go to elections," Livni told Haaretz on Saturday night.
According to the paper, Livni's decision means that early parliamentary elections will probably be held in February or March. The next parliamentary election had been scheduled for 2010.
"Following her win in the race for the party leadership in September, Livni had 90 days to put together a government, but has conceded that she cannot do so effectively," the paper said.
"The ultra-Orthodox Shas party announced Friday that it would not join a Livni coalition, citing differences over the future of Jerusalem in the political process, and its demand for increased welfare benefits," the paper said.
