Tory leadership contender Murdo Fraser will formally launch his campaign with a vow to disband the Scottish party if he is elected.
Mr Fraser, who is already deputy leader of the Scottish Conservative and Unionist Party, says the brand is "tainted" and needs to be totally overhauled if it is to become a credible force.
The debate has already split some senior Conservatives. But it prompted Glasgow MSP Ruth Davidson to confirm she will enter the leadership race and protect the present party.
Outlining his plan on Sunday, Mr Fraser said: "What I'm saying is there's a lot of interest in centre-right values among people in Scotland, but they don't vote for the Conservative Party.
"I think it's time we launched a new, progressive, centre-right party with a distinct Scottish identity. One that would have a partnership with the UK Conservative party, and in other respects be operationally independent. I think that would be much more attractive to many people in Scotland who share our values.
"We'd be able to elect far more MPs to the House of Commons to support a future Conservative government than the one we have."
The new group, which does not yet have a name, would contest Westminster, Holyrood and council elections, leaving Prime Minister David Cameron with the prospect of having no MPs in Scotland.
Mr Fraser is widely seen as the front-runner in the contest to replace Annabel Goldie.
Sir Malcolm Rifkind, a former Scottish Secretary in Margaret Thatcher's government, said: "I think that what Murdo Fraser is saying is very refreshing. In broad terms, I welcome it."
Education Secretary Michael Gove, a Scot, said the party should be allowed to determine its own destiny. But Scotland Office minister David Mundell, the only Tory MP in Scotland, said changing the name is a "simplistic" approach.