The lawmakers' threat once again raises tensions within the coalition of Berlusconi's People of Freedom (PDL) and its rival centre-left Democratic Party (PD), a government which was forged after a general election in February that failed to give any party a ruling majority.
A cross-party senate committee has been set up to decide whether Berlusconi should be stripped of his senator post following the criminal conviction, and is due to vote on the issue on October 4th.
Given its composition, the 23-member senate committee is widely expected to vote for Berlusconi's expulsion.
Late on Wednesday, a proposal put forward at the PDL meeting by former Senate chief Renato Schifani for MPs to resign en bloc was greeted with approval and sustained applause.
An aide of Berlusconi, Renato Brunetta, said however that "there was no proposal for mass resignation. We have only asked each parliamentarian to reflect on and decide according to his or her conscience".
President Giorgio Napolitano is seeking details on the conclusions of the PDL meeting.
PD leader Guglielmo Epifani condemned the decision by PDL lawmakers, calling it "a proof of irresponsibility for the umpteenth time towards the country".
"The PDL risks destroying everything and destabilising the actions of the government which is seeking to resolve the problems of the Italian people," said Epifani.
According to participants of the PDL meeting, Berlusconi told lawmakers that "it has been 55 days that I haven't slept".
"These are the most horrible days of my life, to be thrown out (of parliament) for such a libellous accusation," he reportedly said, adding that he had "lost 11 kilos, like the years in prison that they want me subjected to".
The lawmakers also quoted Berlusconi saying that the left is "rejoicing because it believes that it would have an open path to power now that I have been convicted".
Despite the threats from the PDL, Economy Minister Fabrizio Saccomanni played down the risk that the coalition government would collapse.
"Not one party has the interest to interrupt the cleaning up of (the public) accounts and a recovery of the economy," he told television channel La Sette.
Most experts agree that Berlusconi's supporters are unlikely to bring down the government, even though they have repeatedly threatened to do so if their leader is expelled from parliament.
Berlusconi in August received his first definitive conviction in decades of legal battles in a landmark supreme court decision that has put Italy's political scene on edge once again.
Berlusconi, who is also appealing convictions for having sex with an underage prostitute and abuse of office, faces 12 months of either house arrest or community service and a temporary ban from parliament.