Birmingham will receive extensive new powers to run its own affairs if it accepts the need for a strong leader such as a mayor, Ministers have pledged.
A planned revolution in local government, to be unveiled in October, will offer councils billions of pounds of extra funding and control over transport, planning and economic development.
But in return, they will have to explain how they plan to provide "strong and accountable leadership", said Local Government Minister Phil Woolas.
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He said: "We are very much pushing them to consider the idea of an elected mayor or elected mayors."
The West Midlands could even have a regional mayor as well as individual mayors for cities such as Birmingham, Wolverhampton and Coventry, he said.
Mr Woolas was speaking before a Government summit in London today on ways of improving the leadership of major cities.
It will be attended by Mike Whitby, leader of Birmingham City Council, as well as London Mayor Ken Livingstone and the mayors of Washington DC, Lyon, Milan and Gdansk.
But the Minister said he was not convinced by plans drawn up by local councils for a West Midlands city region.
Coventry, Dudley, Sandwell, Solihull, Walsall, Wolverhampton, Birmingham and Telford want to create a West Midlands executive which includes the existing council leaders.
Instead of a mayor, they want one of the leaders to become the executive's chairman - and the public face of the region.
Mr Woolas said: "My personal opinion is they would need to toughen that up and show how there was accountability in that."
However, he said he was willing to consider alternative proposals.
The Government was willing to let regions and individual councils make decisions which are currently taken in London, or by unelected quangos, the Minister said.
"We are looking at what we would broadly call economic powers.
"That would be skills, that would be transport, and greater financial flexibility.
"There would be a huge lifting of inspections. Less inspectors coming up from London to make sure councils are doing well, and less targets."
Britain could only thrive and prosper if its major regional cities such as Birmingham were successful, he said.
But he warned: "Birmingham's progress has been superb and radical but it isn't in the European Champion's League - and the UK needs it to be."
Council leaders were not to blame, he said. Instead, the whole system of local government needed to be changed.
Today's summit will look at ways "strong, strategic and visionary leadership" can help cities succeed.
London Mayor Ken Livingstone said: "The decision to establish the Greater London Authority, headed by an executive mayor with real decision making powers, has been vindicated.
And Ruth Kelly, the Secretary of State for Communities and Local Government, said directly elected mayors had benefited many cities in other parts of the world.