British Prime Minister David Cameron will on Tuesday finally explain what reforms he wants for Britain to stay in the European Union before a looming referendum.

Speculation is already rife that he will give his strongest warning yet that he might back Britain leaving the EU unless other European leaders agree to his demands for reform of the bloc.

Nearly three years after promising a vote before the end of 2017, Cameron will outline British demands for renegotiation of its European Union membership terms in a letter to the President of the European Council, Donald Tusk, to be published on Tuesday.

The letter comes ahead of a crunch European summit in Brussels next month and amid hopes that the British referendum on whether to remain an EU member state can be held next year.

In a speech the same day, he will say that if no deal can be reached, he could back a British exit when an in/out referendum is held before the end of 2017, Reuters reported.

"If we can't reach such an agreement, and if Britain's concerns were to be met with a deaf ear, which I do not believe will happen, then we will have to think again about whether this European Union is right for us," Cameron will say, according to advance extracts of his speech.

"As I have said before -- I rule nothing out."

Cameron has faced criticism both at home and abroad -- including from his own eurosceptic backbenchers -- for not spelling out details of the concessions he is seeking from other European leaders with detailed discussions expected to accelerate before a summit next month.

His letter to Tusk is expected to include demands such as barring in-work benefits for EU migrants for four years, an exemption from any closer EU integration, and more powers for national governments to block EU legislation.

British Foreign Secretary Philip Hammond said the letter would draw together changes the government has previously said it is seeking but would not demand specific legislative measures.

"We don't want to be excessively prescriptive at the beginning of a discussion," Hammond told the BBC, saying that there were a range of ways to achieve most of Britain's objectives.

"This letter is not the end of the process, it's the beginning of the process," he said.