2002, which analysts say is partly driven by the fear that if the winner of the 1989 Nobel Peace Prize dies in exile, it could lead to trouble in the Himalayan region.
Lodi Gyari, the Dalai Lama's top envoy to Washington, is expected to hold closed-door talks in Beijing with top officials of the Communist Party's United Front Work Department, the source said, requesting anonymity. The department is responsible for dealing with religious leaders and winning over non-Communists.
"We're going to send a delegation to Beijing soon," the source with close ties to the leadership of the Tibetan government-in-exile told Reuters.
The Chinese Foreign Ministry spokesman's office, reached by telephone, declined to comment.
The Dalai Lama, who fled to India in 1959 after a failed uprising against Communist rule, says he wants greater autonomy, not independence, for his predominantly Buddhist homeland, but China considers him a separatist.
Five rounds of dialogue have been shrouded in secrecy and yielded no breakthrough.
The Dalai Lama was issued a visa to visit Brussels on May 11-12 to meet members of the European Parliament and attend a conference of non-government organisations supporting Tibet.
But he was forced to cancel after the Belgian government informed him of Chinese displeasure with his visit.
Belgium's Prince Filip is due to visit China next month. In 2005, the Dalai Lama was also forced to scrap a visit to Brussels ahead of Belgian King Albert II's visit to China.
"The Dalai Lama gave in to Belgian requests ... to create a conducive atmosphere for an ongoing constructive dialogue," the source said. "This is the main reason why he decided not to go and not to create embarrassment for all parties concerned."
Australia's government and pro-China opposition leader were accused on Wednesday by rights groups and political rivals of caving to pressure from Beijing by refusing to meet the Dalai Lama, who is to tour Australia for 10 days next month, speaking to the national press club and addressing stadium rallies.
After China's Canberra Embassy warned it would be inappropriate for political leaders to meet the exiled leader, the Upper House Senate refused an Australian Greens party request for an official reception at Parliament House.
Resurgent opposition leader Kevin Rudd, a fluent Mandarin speaker who served as a diplomat in Beijing, drew particular criticism for reversing earlier support for the Dalai Lama.
Rudd five years ago met the exiled spiritual leader in Australia and criticised Prime Minister John Howard and Foreign Minister Alexander Downer as "weak" for refusing to do likewise.
The Tibetan government-in-exile condemned China's arm-twisting tactics.
"The Chinese government's persistent attempts to exert pressure on small nations to restrict the movement of His Holiness the Dalai Lama is a case of outright bullying," Kalon Tempa Tsering, spokesman for the Tibetan government-in-exile, said in a statement.
It was also "gross interference in the internal affairs of a sovereign state, setting an unfortunate trend in international diplomacy and undermines the efforts that have been made to create a conducive atmosphere for a just and speedy resolution of the issue of Tibet", the spokesman added.
(Additional reporting by Rob Taylor in Canberra)