Attorney-General Nicola Roxon is set to announce today that she is leaving the portfolio, triggering a wider reshuffle in a dramatic week for the Government.
Prime Minister Julia Gillard will be holding a press conference in Canberra at 11.00am (AEDT) to make the announcement.
Senate leader Chris Evans is also expected to announce his resignation at the press conference.
Follow the ABC News 24 stream for live coverage of the reshuffle.
The resignations come just two days after Ms Gillard announced the federal election would take place on September 14.
Ms Roxon will move to the backbench until the election then leave politics, creating a vacancy in her safe Melbourne seat of Gellibrand.
Trade Minister Craig Emerson says Mr Evans and Ms Roxon are resigning for personal reasons.
"It seems to me to be if Nicola and Chris have come to this view, this would be the right time to announce that they are stepping down," he told ABC News 24.
"That's what they'll be doing with the Prime Minister later this morning.
"Both Chris Evans and Nicola are reflecting on their family situation.
"Nicola's got a little daughter Rebecca and her partner Michael.
"[Ms Roxon's] baby was born while [she] was a member of Parliament.
"She misses her child. Everyone who is watching who is a mum or dad would understand that."
She is expected to be replaced as attorney-general by Mark Dreyfus, who will be promoted from Parliamentary Secretary straight into Cabinet.
Senator Evans is expected to quit his portfolios immediately and leave the Senate within months.
The Western Australian politician is expected to announce his decision at a press conference with Ms Gillard in Canberra later today.
The Labor caucus will have to elect Senator Evans's replacement as leader of the Upper House - the third most senior position in the Government.
Communications Minister Stephen Conroy and Finance Minister Penny Wong are the most likely replacements.
The ABC has been told the two ministers have been discussing their plans with Ms Gillard since last year.
Ms Roxon has been in Parliament since 1998 and Senator Evans has served for 20 years.
Liberal frontbencher Christopher Pyne, who spoke to Lateline before news of Ms Roxon's possible resignation broke, said Senator Evans would not be the last to stand down.
"The information that I have is that Chris Evans has resigned not because of ill health - which was my first thought - but because he has had enough," Mr Pyne said.
"I also hear that he may not be the last resignation in the coming days."
Assistant Treasurer David Bradbury told Lateline that he had not been aware of Senator Evans's decision until just before the program went to air, and was not aware of any further resignations.
Senator Evans was immigration minister under Kevin Rudd's leadership and took on workplace relations in Ms Gillard's first ministry.
In late 2011, the workplace relations portfolio was given to Bill Shorten.
Before entering politics Senator Evans was a union official.
Fellow WA Senator Mark Bishop tweeted that Senator Evans's resignation is "a loss".
"Serious, hardworking competent minister. Unassuming, consistent and effective Senate leader," he said.