Spanish Prime Minister Mariano Rajoy has approved implementing Article 155, which would allow his Madrid government to take back some powers from Catalonia.
The decision was taken after a special cabinet meeting, three weeks after the semi-autonomous region held a controversial independence referendum.
Mr Rajoy is seeking approval from the Spanish Senate strip powers from Catalonia. He added that he wanted elections to take place in the region and could dissolve the Catalan Parliament within six months.
He said the powers of the Catalan administration will be transferred to the Spanish government, but insisted that he did not want to use the powers to rule Catalonia directly.
Mr Rajoy's government is activating a previously untapped constitutional article to take control of the region.
“Government has had to apply Article 155 of the constitution. This is only applied in exceptional circumstances. Spain was on the verge of applying this article previously but it was not necessary as we returned to a legal situation," he said.
"In this case things are different because no government of any democratic country would accept this modification of the law and one party imposing their will on the other. This is why we have decided to impose this article."
The statement followed an independence referendum in the region earlier this month, which was declared illegal by Mr Rajoy's government and the Spanish Supreme Court.
It led to violent clashes between police and voters trying to enter polling stations. But of the 42 per cent of people who voted, the majority opted for independence.
Catalonia’s leader, Carles Puigdemont, had argued the result of the referendum gave him a mandate to pursue independence.