The Barisan coalition will not support a government that is led by ex-premier Muhyddin Yassin's alliance, its biggest component party said, though it did not make any reference to Anwar.
Five days after an election, Malaysia still does not have a government as the two contenders do not have enough support for a majority, resulting in an unprecedented hung parliament.
The uncertainty over the election prolongs political instability in the Southeast Asian country, which has had three prime ministers in as many years, and risks delaying policy decisions needed to foster economic recovery.
King Al-Sultan Abdullah Sultan will meet with other senior royals on Thursday to help decide who will become prime minister.
Media said the meeting would begin at 10.30am (0230 GMT) and was expected to last three hours.
The constitutional monarch plays a largely ceremonial role but can appoint a premier he believes will command a majority in parliament.
The king had suggested that both the leaders work together to form a "unity government" but Muhyiddin declined the proposal.
The incumbent Barisan Nasional, which came in a distant third in the election in its worst electoral showing, has become a crucial player as its support is needed for both Anwar and Muhyiddin to get a majority.
Barisan had this week said it would not support either and would be part of the opposition.
But late on Wednesday, its biggest component party - the United Malays National Organisation (UMNO) - said Barisan would support a "unity government" that is not led by Muhyiddin's alliance.
The statement did not mention Anwar.
Anwar's progressive coalition, known as Pakatan Harapan, won the most seats in the Saturday election with 82, while Muhyiddin's conservative Malay Muslim alliance called Perikatan Nasional won 73.
They need 112 - a simple majority - to form a government.
Barisan has 30.
Muhyiddin's bloc includes the Islamist party PAS, whose electoral gains have raised concern in a country with significant ethnic Chinese and ethnic Indian minorities, most of whom follow other faiths.
Investors have also been spooked over worries about the Islamist party's possible impact on policies.
Short video platform TikTok said on Wednesday it was on high alert for content that violates its guidelines in Malaysia after authorities warned of a rise in ethnic tension on social media following the election.
