Aviation industry leaders have warned of the “catastrophic” impact of the potential move, which is to be discussed by ministers on Tuesday.
It comes amid reports that such a hotel quarantine requirement could cost travellers more than £1,000, and take three weeks to implement.
Hotels forced to shut their doors due to the fall in passenger numbers will need time to reopen, the Times reported.
Hotel quarantine rules for international travellers have already been implemented in other countries, such as Australia and New Zealand.
The Best Western hotel chain, which has more than 250 locations in Britain, said it was waiting for a Government “green light” on the move.
Last month, the firm said it was working to make 180 hotels available to the NHS for care of non-Covid patients to free up capacity.
Other hotel chains contacted on Monday said they were waiting for an announcement from the Government before commenting further.
Earlier on Monday, the Airport Operators Association and Airlines UK issued a joint statement insisting that the UK already had “some of the highest levels of restrictions in the world”.
They claimed that introducing tougher rules would be “catastrophic”.
They warned that further measures would “impact vital freight and PPE (personal protective equipment) supplies and jeopardise tens of thousands of jobs and the many businesses that depend on aviation”.
A spokesman for Heathrow Airport warned that “a blanket hotel quarantine” would mean the effective closure of the UK’s borders and carried “huge ramifications” for the country and the aviation sector.
The airport called on Chancellor Rishi Sunak to provide a “comprehensive financial support package for UK aviation”.
In March last year Australia introduced strict border controls, including all requiring arriving travellers to undertake 14 days of quarantine in a designated facility.
Quarantine is administered by the country’s states and territories and inbound travellers have to contribute to hotel quarantine costs.
In New South Wales (NSW), air passengers must undergo a Covid-19 symptom and temperature check at the airport.
Those with symptoms will be tested at the airport and transferred to a hotel managed by NSW Health to await their result. People without symptoms can collect their luggage and are transferred to a hotel or other designated facility.
All accommodation is pre-arranged, with food provided, and travellers are invoiced by NSW at the end of their stay.
Those not following the rules face heavy penalties.