The Taoiseach says we should not be surprised if Fianna Fáil forms some sort of government with Sinn Féin.
The latest opinion poll, published in today's Sunday Times, has shown that Fine Gael and Fianna Fáil have both made gains, with Leo Varadkar's party only three points ahead of the largest opposition party.
Sinn Féin is down five points, but still has 14% support.
Fianna Fáil leader Micheál Martin has repeatedly said that his party will not be doing a deal with Gerry Adams.
Leo Varadkar says that while he believes Deputy Martin, the opposition leader may not have the final say.
Speaking to On the Record with Chris Donoghue, the Taoiseach said: "I don't necessarily believe that that's the view of Fianna Fáil, or that he would necessarily be in the position to always honour that.
"We've heard other Fianna Fáil politicians talking about their support for coalition with Sinn Féin. We've heard Jim O'Callaghan, for example, positing a different idea, which isn't coalition - they could have a confidence & supply with Sinn Féin, a bit like they have currently with Fine Gael."
He added: "We should bear in mind that Mary Lou McDonald used to be a member of Fianna Fáil. If she were to become the leader of Sinn Féin, given her own Fianna Fáil background, I think that would help those two parties potentially to come together in coalition.
"I believe Micheál Martin is sincere in what he says, but I don't believe that the possibility of a Fianna Fáil and Sinn Féin government is off the table."
In the interview, he also addressed issues such as the housing crisis and issues in the health sector.
He stressed that he's determined to make the current Government 'last and work', but noted: "I also am a realist - I know these things aren't necessarily under my control. Fianna Fáil is in the position to bring the Government down if they were to choose to do so.
"Even the loss of a few members - for political reasons or even personal tragedies - would cause us to lose our majority. But I'm not planning an election at this stage."
