Leaving the European Union could trigger "a bright new future" for the UK, senior Conservative MP David Davis has said.
Rejecting arguments of "scaremongers" that departure would be damaging to jobs and trade, Mr Davis insisted that exit is "neither high-risk nor frightening" for Britain, giving it a strong bargaining position in any membership renegotiation if it makes clear it is ready to walk away.
The former Tory chairman, who fought David Cameron for the Tory leadership in 2005, urged the Prime Minister to pursue a "much more ambitious" strategy than currently envisaged in the renegotiation he has promised if he wins next year's general election.
Writing in the Mail on Sunday, Mr Davis said that it was now generally assumed that the eurosceptic UK Independence Party will win the European elections on May 22, and said that Ukip leader Nigel Farage's TV debates with Deputy Prime Minister Nick Clegg had put the question of whether Britain was better off in or out "in the centre of public debate".
Britain has to recognise that "leaving is a real possibility, and make our partners recognise that", he said.
He dismissed as "nonsense" Mr Clegg's claims that Britain would be isolated outside the EU and would struggle to forge acceptable trade deals.
As the world's sixth largest economy with the fourth largest military budget and membership of the G7, G20, UN Security Council, Nato, OECD and Commonwealth, "little if any" of Britain's influence and reputation is dependent on the EU, said Mr Davis.
"The remaining EU members have a massive vested interest in ongoing free trade with the UK," he said.
"If a British exit happened tomorrow, we would be the EU's single biggest market, accounting for 21% of its exports, so our negotiating clout would be enormous.
"In short, we can get a good deal from the EU, and the EU knows it. Exit is neither high-risk nor frightening.
"Just as the ability to walk away means you can strike a better price for that house or car, so having an attractive alternative allows us to get a better deal in Europe. Any deal to stay in should be much more ambitious than anything the Government has so far suggested."
Britain should demand a permanent opt-out from future EU proposals which it feels are not in its national interest, said Mr Davis. It should follow Switzerland in allowing EU citizens to take up residence only if they have a job and health insurance and subject to national immigration limits.
And any renegotiation should keep Britain outside the European Arrest Warrant, strip the European Court of its say in the national justice system, exempt every small business that does not trade with the EU from single market regulations and revamp the Brussels regulatory system to cut thousands of rules, he said.
"The choice in the referendum should be between exit, which offers opportunities for growth greater than we currently enjoy, or a radically reformed Europe in which Britain can shed the job-destroying red tape while recovering control of matters vital to the very nature of our country," said Mr Davis.
"They are two attractive futures - both better than where we are now."
And he made clear he does not believe the UK has any reason to fear quitting the EU: "Far from spelling the end of Britain's international influence, EU exit could be the catalyst for an intellectual, economic and political liberation.
"It would give Britain the chance to forge new relationships, pursue a new strategy reflecting our historical connections and global standing, and exploit our language, law, scientific, cultural and commercial creativity, and even our time zone.
"This would be a revolution of expectations and ambition."
Irish Taioseach Enda Kenny told BBC1's Andrew Marr Show: "I believe that the European Union is far stronger with a strong Britain in it.
"I agree with David Cameron very strongly about the single market. I agree with David Cameron about the extent of the digital capacity. We have to deal with the energy system, we have to eliminate further red tape, we have to get the trans-Atlantic trade talks in operation. This means millions of jobs on either side of the Atlantic.
"Europe would be very much weaker without a strong Britain in there and we do hope that the potential of the 500 million (people) market is eminently understood by British business.
"It's something that we would consider would be very much in Britain's interest, but that's a matter, obviously, at the end of the day, for the British people."