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EU ministers have warned they will boycott a US-led climate summit next month unless the Bush administration backs firm targets for emissions cuts.
The US favours allowing governments to set voluntary targets.
Indonesia is reported to be trying to broker a compromise that would remove firm targets from the final text.
Former US vice-president Al Gore has criticised the US approach.
He won loud applause from delegates as he said: "My own country, the United States, is principally responsible for obstructing progress in Bali."
'Don't give up'
But the Nobel Peace Prize laureate also urged delegates not to give up.
"You can decide to move forward and do the difficult work that needs to be done," he said.
If they get this text through the conference then the next treaty won't be worth the paper it's written on 
Officials say agreement has been reached on many issues. Disagreement centres on pollution by industrialised countries.
On one side are the European Union states and their allies.
They want industrialised countries to agree to cuts of 25%-40% in greenhouse gas emissions - which mainly come from burning fossil fuels - from 1990 levels by 2020. The target would not apply to developing countries.
"We continue to insist on including a reference to an indicative emissions reduction range for developed countries for 2020," the EU's Environment Commissioner Stavros Dimas said in a statement.
On the other side are the US, Canada and Japan. The US in particular, which has not ratified the Kyoto agreement, says any numerical agreement would prejudge the outcome of future talks.
The environmental group Greenpeace has accused the US of trying to kill off the international fight against climate change.
"If they get this text through the conference then the next treaty won't be worth the paper it's written on because it will give a free pass to any nation that wants to keep polluting," Greenpeace's UK executive director John Sauven told the BBC.
Meaningless talks
The US is the world's biggest emitter of greenhouse gases, and most parties recognise that climate change talks without it would be meaningless.
In September the US hosted the inaugural summit of the "major economies" or "big emitters" group, which brings together 16 of the leading greenhouse gas producing countries.
The US is due to host a second summit next month in Honolulu.
The BBC's environment analyst Roger Harrabin, reporting from Bali, says the European threat to boycott the conference pushes President Bush into a corner.
Either he agrees to negotiate big cuts, or he has to explain to an increasingly concerned American public why Europe is boycotting a meeting which the president himself has invented and championed, our correspondent says.
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