Negotiations on David Cameron's EU reform demands have made "no real progress" so far, Downing Street sources say.
The first EU Council session ended with no agreement on several issues as Number 10 played down hopes of a deal.
EU sources said the talks were "constructive" but said other countries had spoken out against the PM's plans.
Friday's session on the UK's demands has been put back to allow him to speak to individual leaders one-to-one.
The 28 EU leaders are now holding a working dinner to discuss their response to the migration crisis.
When talks return to the UK's reforms, Mr Cameron will seek to secure the deal which he wants before holding an in/out referendum on the UK's EU membership.
However, he has said he will walk away from the summit without agreement unless he gets a "credible" package he can sell to voters in the referendum.
The PM's Eurosceptic critics have branded the process a sham, saying that even if the reforms are agreed they will not allow the UK to block unwanted EU laws or affect the scale of EU migration.
BBC political editor Laura Kuenssberg said a Downing Street source was claiming the talks had reached an "impasse".
It is not clear whether the downbeat mood is "summit theatrics or genuine disappointment" that negotiations are not progressing, she added.
An EU source spoke of five key areas where agreement has not been reached:
- How the EU's binding treaties will be altered to make the changes
- How many member states can trigger an "emergency brake" on migrant welfare
- For how long a member state can impose restrictions on in-work benefits for migrants
- Whether child benefit curbs can be applied retrospectively
- Changing treaties to alter the principle of "ever-closer" union
Thursday's meeting was "intense and constructive", an EU source said, but while all the countries confirmed their wish for the UK to stay in, some also set out specific concerns.
"We expected this," the EU source said: "But honestly we had hoped for some of them to be less critical."
Earlier, senior EU officials talked up the chances of a deal, with European Commission president Jean-Claude Juncker saying he was "quite confident" during the Council meeting and Council president Donald Tusk saying it was a "make-or-break summit".
Mr Cameron is now expected to meet Mr Tusk later to discuss how Friday's session will proceed.
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