The leaders of the socialist, conservative and far-right leaders must approve reported cuts to the minimum wage -- strongly resisted by unions -- in addition to pension reductions and 15,000 civil service redundancies.
"I am troubled by the innermost intentions of our creditors," far-right leader George Karatzaferis told reporters on his arrival, adding that a pressing schedule was being used to "blackmail" Greece.
Greece kept the eurozone and financial markets on edge during the day, with the meeting of leaders backing Papademos' government repeatedly postponed since Sunday.
Agreement on new measures demanded by the EU, the IMF and the European Central Bank -- known as the 'troika' -- and on a debt-write down by banks would open the way for a second rescue and so close a key chapter in the eurozone crisis.
The party heads earlier in the day received a 50-page text with the austerity cuts demanded in return for new loans under a 130-billion euro ($171-billion) eurozone bailout originally agreed in October.
Press reports have said that the latest measures, reportedly tweaked up to the last minute, include a cut of 22 percent in the minimum wage and 15-percent cuts in complementary pension programmes, along with a separate 15-percent reduction for public utility pensioners.
About 15,000 Greek public sector jobs are thought likely to be axed.
The new funding is vital if Greece is to avert a debt default on March 20, when it must repay 14.5 billion euros to bond holders.
If a deal emerges, it will be presented by Finance Minister Evangelos Venizelos to eurozone finance ministers on Thursday and be tabled in parliament on Friday for approval by Sunday, the semi-state Athens News Agency reported.
The text was drawn up during a night of marathon talks between Papademos and representatives from the troika aimed at setting up a second rescue for Athens following an initial bailout worth 110 billion euros in May 2010.
In Luxembourg, the head of the Eurogroup finance ministers Jean-Claude Juncker said that they may hold talks on the package on Thursday depending on the outcome of negotiations in Athens.
"Tonight at the latest I will decide if a Eurogroup meeting will take place tomorrow evening or not," Juncker said.
On the bond markets, where tension has eased markedly since the beginning of the year, the reaction was subdued.
"Whether this turns out to be the good news that the market is currently expecting, or another short term rally followed by a painful pull back remains to be seen," analyst Alistair Cotton said in a note.
"But there is reason to remain sceptical given the number of times over the last two years news about a Greek rescue deal moved the market in exactly the same way; euro positive on the rumour, retracement on the fact," he said.
The coalition party leaders were given a few hours to study the plan, which was said to include cost-saving measures worth 3.2 billion euros.
Savvas Robolis, a senior labour analyst at leading private-sector union GSEE, said the minimum wage cuts would affect 325,000 people or 17 percent of the workforce.
"The minimum wage will drop to around 500 euros ... and this will create a 2.2-billion-euro shortage in health and pension funds," he told Flash Radio.
The country is running out of time to agree the deal and to conclude a separate debt write-off with banks and other private creditors worth at least 100 billion euros.
Greece has run up total debt of about 350 billion euros, roughly 160 percent of its gross domestic product, and the IMF has insisted that level be brought down to a maximum of 120 percent of GDP.
On Tuesday, Papademos met Charles Dallara, head of the Institute of International Finance and chief representative in the private debt discussions.
The Wall Street Journal reported on Wednesday that the ECB would participate in a writedown of Greece's debt by agreeing "to exchange the government bonds it purchased in the secondary market last year at a price below face value, provided the debt-restructuring talks have a successful outcome."