The British offer, which followed an urgent appeal by the United Nations High Commissioner for Refugees (UNHCR) for countries to provide safe havens, was criticised by refugee aid groups for being "vague and mealy-mouthed".
Britain had been anxious not to give Serbia a signal that a policy of ethnic cleansing could succeed but relented to pressure to take its "fair share" of refugees after firm commitments were made over the weekend by other countries.
Germany agreed to take 40,000 people, the United States is accepting 20,000, Turkey 20,000, Norway 6,000, Greece 5,000 and Canada 5,000. A Nato spokesman said the refugees would be taken in temporarily and would later be returned to a "democratic, peaceful, multi-ethnic Kosovo".
A Home Office spokesman said: "We are ready to take more [refugees]. We are not in a position to confirm any numbers but we are talking about some thousands."
He added that Britain's top priority was still to get refugees "back to their homes and enable them to rebuild their lives in a secure environment".
At a meeting with officials from (UNHCR) the Immigration minister, Mike O'Brien, agreed to draw up contingency plans for a "temporary protection programme".
In the past 15 months, Britain has received asylum applications from 9,000 Kosovo Albanians. Some 89 per cent of applications dealt with so far have been accepted, although 7,000 are still being processed.
Figures from the UNHCR yesterday suggest the number of asylum seekers headed for Britain could increase substantially. The UNHCR said 435,500 refugees have now fled Kosovo, including 65,000 in the past 24 hours.
Some 366,000 have left since the start of the Nato bombing campaign on 24 March, with 204,000 crossing into Albania, 118,000 into Macedonia, 33,000 into Montenegro, 6,000 into Bosnia and 5,000 into Turkey. The condition of most refugees means they cannot cross Europe in search of sanctuary.
Nick Hardwick, chief executive of the Refugee Council, said Britain should act now to ensure refugees came here in an organised fashion.
He added: "Traffickers will start to go into the camps. It will be much better if we have an organised programme rather than let the international criminals who run the trafficking do it for us."
He said the Government should accept as a priority some refugees who were injured or sick and not receiving suitable medical treatment.
Mr Hardwick agreed most Kosovo Albanians should be helped to return home, but he called on the Government to take in some who had relatives and friends already in Britain. His view was supported by the Labour MP Ann Clwyd, who said: " I am sure the people of Britain will respond generously to the situation that these people are in."
The Home Office has intimated it wants to avoid the mistakes made in settling previous large influxes of refugees. Ugandan Asians who fled Idi Amin's dictatorship in 1972 were initially housed in camps, a policy that would encounter opposition from refugee aid groups if it were repeated.
In another unsuccessful exercise, Vietnamese "Boat People" were thinly spread around Britain in what has been described as a "Marmite strategy", which left them isolated from other Vietnamese and specialist support services.
By contrast, the 10,000 to 15,000 refugees arriving from the war in Bosnia over the past decade have been successfully accommodated in "cluster" communities in Derby, Dewsbury, Glasgow, Oxford, the North-east and London.
Mr Hardwick said: "Now that we have seen pictures of what a real refugee crisis looks like, I hope we will not be seeing any more scare stories about a few dozen people turning up in a British city."
A Nato spokesman in Brussels saidthat aircraft transporting aid to the region could bring back refugees to countries willing to house them.
Britain's contribution of pounds 20m in humanitarian aid is far higher than any from other countries except the US, which has given pounds 31m.Reuse content