The department has angrily thrown back a report submitted by the British Rail board on the two main options for the London station, a low-level structure at King's Cross or a refurbished St Pancras.
The board, fearful of legal action from the London Regeneration Consortium that is the proposed developer of the 134-site north of King's Cross, wants to stick with the low-level option.
Union Railways, the BR subsidiary that will build the link to the Channel tunnel, prefers the St Pancras option, because it reckons it would cost about half the pounds 1.4bn of the low-level station.
Department of Transport officials believe that BR's report does not provide sufficient information on the St Pancras option and also implies that the cost difference between the two proposals is quite small.
This has angered John Prideaux, the chairman of Union Railways, who has fought hard for the St Pancras scheme. He is convinced that this option would be much cheaper, even though it would involve moving two listed gasometers to the north of the site.
Under the scheme, the main line to Sheffield would be moved to King's Cross, and St Pancras would have two platforms for Network SouthEast's Thameslink services. The low- level terminus option would also handle Thameslink.
BR argues that changing the plans could result in further delay. However, Dr Prideaux reckons that even BR's favoured low-level terminal at King's Cross is likely to take longer to build than the link itself, which could be completed by the end of 1999.
Transport ministers, anxious to publish the suggested line of the rail link to Folkestone before the county council elections on May 6 may be forced to issue the plans for the Kent section separately.