Sir Vince Cable – the likely next Lib Dem leader – says he is “beginning to think Brexit may never happen”.
He said “enormous” divisions in the Labour and the Tory parties and a “deteriorating” economy would make people think again.
“People will realise that we didn’t vote to be poorer, and I think the whole question of continued membership will once again arise,” he said.
He was speaking on the BBC’s Andrew Marr show.
His comments were dismissed by leading Eurosceptic Conservative MP Owen Paterson, who said Sir Vince was just “chucking buckets of water around” and ignoring the “huge vote” in favour of leaving in the referendum and at the general election, where the two main parties backed Brexit.
“Vince Cable’s party went down in votes, as did the other little parties who want to stay in the European Union,” he told the BBC’s Sunday Politics.
He added: “I am afraid Vince is behind history. We are going to leave. We are on target.”
Sir Vince conceded that the Lib Dem policy on a second referendum on the terms of a Brexit deal “didn’t really cut through in the general election”.
But he said it could offer voters “a way out when it becomes clear the Brexit is potentially disastrous”.
The former business secretary looks set to be crowned Lib Dem leader. He is the only candidate following the resignation of Tim Farron.
Sir Vince told the BBC he wants to work with Labour and Tory MPs to block what he regards as Theresa May’s “hard Brexit” policy.
“A lot of people are keeping their heads down,” he said, and “we’ll see what happens” when MPs returned from their summer break.
But he added: “I’m beginning to think that Brexit may never happen.
“The problems are so enormous, the divisions within the two major parties are so enormous. I can see a scenario in which this doesn’t happen.”
MPs are set to vote on the Repeal Bill, a key piece of Brexit legislation, in the autumn.
Sir Vince has said he wants to form a cross-party coalition including like-minded Tory and Labour MPs to oppose Britain’s exit from the single market – the official policy of both the Conservative and Labour parties.
He said Labour MPs who disagreed with their leader’s position were welcome in his party, and predicted Labour’s divisions on the issue would get worse.
“Jeremy Corbyn had a good election, for sure, but there is an element of a ‘bubble’ about it,” he told Andrew Marr.
“He managed to attract large numbers of people on the basis that he was leading opposition to Brexit.
“Actually he is very pro-Brexit, and hard Brexit, and I think when that becomes apparent, the divisions in the Labour Party will become more real and the opportunity for us to move into that space will be substantial.”
Sir Vince has come under fire for saying Theresa May’s comment, in her 2016 Conservative Party conference speech, that “if you believe you’re a citizen of the world, you’re a citizen of nowhere,” was like something out of Adolf Hitler’s Mein Kampf.
Quizzed by Andrew Marr on this, Sir Vince said he had got the wrong dictator: “I got my literary reference wrong – I think it was Stalin who talked about ‘rootless cosmopolitans’.”
Sir Vince, who won back his Twickenham seat at the general election, is not expected to face a challenger for the Lib Dem leadership but he said would still produce a manifesto. He suggested he would back income tax rises to pay for improvements to health and social care.