According to reports, Google has already developed prototype handsets and has approached several wireless operators in the US and Europe, including T-Mobile USA and Orange.
It has also submitted a bid in the US government's upcoming auction of wireless spectrum, which indicates it is looking at becoming a mobile network operator itself.
Unlike Apple's iPhone, which is available through just one operator in the US, Google hopes that multiple operators will offer its phone.
Google has recommended that manufacturers build phones with technology that will support its applications, including a camera, built-in wi-fi, 3G networking and GPS.
A Google spokesman declined to comment on a Google phone, but said: "We are partnering with almost all of the carriers and manufacturers to get Google search and other Google applications onto their devices and networks."
The company's move into the mobile phone market would give it the potential to broker ads on mobiles, replicating the success it has built online.
But some mobile companies are cautious about handing over too big a share of their revenues to the search giant.
Lowell McAdam, Verizon Wireless chief executive, said its carrier had chosen not to integrate Google's web search engine tightly into its phones because of Google's demands to get a large share of search-based ad revenue.
McAdam said: "What this really boils down to is a battle for the mobile ad dollar."
The Google phones are reportedly still in the planning stages and would not be available to consumers until next year at the earliest.