The prospect of a 'Blukip' alliance between David Cameron and Nigel Farage is now just as likely as a coalition between the SNP and Labour, Nick Clegg claimed today.

The Deputy Prime Minister said there was a 'very real danger' that Ukip and Northern Ireland's DUP could hold Mr Cameron to 'ransom' in the event of a second hung Parliament.

Mr Clegg's remarks come after Mr Farage held out an olive branch to the Prime Minister last night - as he said he wanted to work with him to prevent a possible Labour government.

The Lib Dems released a new campaign poster this morning warning of the danger of a 'BluKip' alliance between the Tories and Ukip

The Ukip leader called on Conservatives to vote tactically for him in seats where they cannot win in order to help keep the Tory leader as Prime Minister.

And in the strongest hint yet that they could work together, Mr Farage dropped his demand that the Tories ditch Mr Cameron before any post election deal.

Deputy Prime Minister Nick Clegg said the remarks showed that the 'mood music' had changed in the Conservative Party. He said: 'Only yesterday there were reports of Nigel Farage opening 'back channels' with the Tories to discuss a post-election pact.

'The Tory right wing has been waiting for its moment to reclaim the Conservative Party for years.

'And, with the help of MPs from UKIP and the DUP, that moment may be about to come.'

Mr Clegg added: 'Everyone knows that David Cameron and Ed Miliband won't win this general election outright.

'That means that someone else will hold the balance of power on 8 May. The prospect of a left wing alliance between Labour and the SNP has been well covered.'

The Deputy Prime Minister said there was a 'very real danger' that Ukip and Northern Ireland's DUP could hold Mr Cameron to 'ransom' in the event of a second hung Parliament

But he added: 'What's equally possible is an alliance that will drag Britain further and further to the right: BLUKIP – a bloc of right wingers from UKIP, the Conservatives and the DUP that could hold the balance of power.

'There is a very real danger that Nigel Farage and his friends could hold David Cameron to ransom.'

It comes after Mr Farage issued a direct appeal to Tory voters yesterday.

Mr Farage said he believed many were in 'their hearts' closer to his position of wanting an EU referendum as soon as possible without any attempted re-negotiation.

Mr Farage also revealed that he has already held informal discussions with Tories about potential post-election arrangements.

Yesterday, as he launched his party's manifesto, Mr Farage called on Mr Cameron to join with him to lock Ed Miliband and the SNP's Alex Salmond out of Downing Street.

The Lib Dem leader's remarks come after Mr Farage (right) held out an olive branch to the Prime Minister (pictured in Glasgow this morning left) last night - as he said he wanted to work with him to prevent a possible Labour government

Ukip has reduced its list of targets to just ten seats as it has been squeezed in the polls, but Mr Farage believes in seats such as Great Grimsby and Dudley North it has a better chance than the Tories at snatching them from Labour.

Asked if it was time that Conservative supporters realised that Ukip could help them stop a Labour government, Mr Farage said they needed to vote tactically.

He said: 'One of the things I have completely failed to understand is how the Conservatives would want to say vote Ukip get Labour in constituencies like Grimsby and Rotherham and Dudley North and all those Labour seats in which we are the challenger . I just don't understand it.'

He warned that a Labour-led government backed up by the SNP 'would not be a very good thing for the country'.

DUP leader Nigel Dodds could help prop up the Tories in power in the event of another hung Parliament

Asked if he and Mr Cameron could ' lock out ' Mr Miliband and Mr Salmond from Downing Street, he replied: 'Well if that were possible then we would try and do that.'

Mr Farage previously said that Mr Cameron would need to step down as Tory leader before he could do any sort of post-election deal.

But yesterday he said there would be no problem working with Mr Cameron personally.

He said: 'Albeit reluctantly, David Cameron has been forced into making a pledge on a referendum. There are circumstances in which we could do a deal with him but the referendum has got to be a proper one and not in 2017.'

Mr Cameron a fortnight ago urged Conservative supporters who have defected to Ukip to 'come home' and pleaded with them not to use their vote in the General Election as a 'protest'.

Yesterday asked what his message was to Tory voters, Mr Farage called on them to work with him to bring forward the referendum Mr Cameron has promised on EU membership by 2017.

He made a reference to comments by Jean-Claude Juncker, the European Commission President, that any meaningful renegotiation would not be possible until 2019.

He said: 'I've said from the start there is no re-negotiation of any value whatsoever and it would appear that my old mate Mr Juncker is backing that up.

'The idea that we would need to wait for two or more years for a referendum is not something that I find acceptable.'

Mr Farage said he would also want the Tories to match his commitment to Nato's target of spending 2 per cent of national income on defence.

He admitted that he had already been involved in 'informal' discussions with those in other parties about possible deals.