Around 50 Conservative MPs are believed to have gathered to discuss ways of unseating Theresa May at a meeting of the European Research Group (ERG).
A number of MPs told how they had already submitted letters of no confidence to Sir Graham Brady, chairman of the 1922 Committee, and others discussed plans to follow suit.
If 48 letters are handed over, a vote of no confidence would be triggered.
Michael Fabricant MP who was present at the meeting took to Twitter to dispel the rumours of a major leadership challenge.
He said: "Reports of Theresa May's demise are greatly exaggerated. Of the 40-50 there, only five to six people discussed letters to the chairman of the 1922 and they wrote ages ago.
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"The rest of us sat in uncomfortable silence. Though most are unhappy with Chequers."
Following the meeting, Michael Gove has called for "unity" within the party.
Mr Gove, who unsuccessfully stood against Mrs May for the leadership in 2016 after David Cameron stood down, told BBC Radio 4's Today she was doing a "great job at the moment".
Asked whether it would be better for Mrs May to tackle any leadership challenge head-on, he replied: "No. This is loose talk, you always have loose talk.
"The critical thing is to ensure that we deliver on that Brexit mandate.
"Any diversion or any distraction from that mission means that our ability to ensure that the referendum mandate that we were given is delivered, is undermined."
Downing Street on Tuesday reiterated that Chequers was "the only serious, credible and negotiable plan which is on the table which both delivers on the will of the British people and which prevents the imposition of a hard border in Northern Ireland".