OTTAWA - Stephane Dion has decided not to run a Liberal candidate against Green Party Leader Elizabeth May in the next federal election.

Dion, who shares May's environmental idealism, is expected to make the announcement today at a joint news conference with May in Central Nova. In return, sources say May will promise not to run a Green candidate against the Liberal leader and will essentially endorse Dion for prime minister.

The extraordinary back-scratching between two supposedly rival leaders is unheard of in Canadian politics and could generate a backlash within both parties.

Many Greens are already upset with May for lavishly praising Dion's environmental record and inferring that he'd make a better prime minister than Stephen Harper.

But there are potential benefits for both the Liberals and the Greens in such an arrangement.

For May, the strategy could shorten her lengthy odds of winning the Greens' first seat in the House of Commons. But she still faces an uphill battle.

She has chosen to run in Central Nova, a longtime Conservative stronghold currently held by Foreign Affairs Minister Peter MacKay. To beat MacKay, May would have to pick up all the votes that went to the third-place Liberals in 2006 and half the second-place NDP's votes.

Many polls suggest the Greens have doubled their support from the 2006 election since May became leader in August. That support has bobbled above and below 10 per cent, but May is perceived to have credibility on the issue that has been a top priority for Canadians of late _ the environment.

Dion's odds of holding his safe Montreal seat are already so good that the Greens' non-participation will make little difference. He won St. Laurent-Cartierville with almost 60 per cent of the vote last time.

But there are other potential benefits for Dion. Liberal sources say the move is intended to demonstrate that Dion is a different kind of politician -- a man of principle who believes so strongly in the need for environmental sustainability that he's willing to sacrifice partisanship.

Moreover, Liberals hope the pact will restore some lustre to Dion's credentials as an environmental champion, which Harper's Tories have been chipping away at for the past few months. And they hope the endorsement from a credible environmentalist like May will help the Liberals win back votes that drifted to the NDP in the last election.

May's support didn't have the desired effect in the last election, when she and a number of other environmentalists and left-wing activists endorsed the Liberals under Paul Martin in a last-ditch bid to stave off a Harper victory. She was not Green party leader at the time.

Not all Liberals are happy about the move. Privately, some expressed fear that the pact reinforces a slew of negatives for Dion: that he's weak and needs to be propped up by another party, that he's a one-note leader fixated on climate change, that he's abandoned the political centre and is allying himself with a left-wing, one-issue party.

As well, some Liberals are loathe to give up their historic boast that they're a national party that always runs candidates in every single riding across the country. Dion himself was still making that boast as little as three months ago.

Dion held a conference call Thursday evening with senior Nova Scotia Liberals to inform them of his decision. Sources said many of those Grits were dead set against giving May a free pass, although some relished the prospect of making it easier to defeat MacKay.

May faced considerable grumbling within her party's ranks last month after Vancouver Island environmentalist Briony Penn defected from the Greens and announced her decision to run for the Liberals in the coming election. Penn said May's praise of Dion had inspired her decision to switch parties.

Jamey Heath, an environmental activist and onetime adviser to NDP Leader Jack Layton, expressed incredulity that May would effectively back a party whose record on reducing greenhouse gas emissions is worse than that of the United States under President George W. Bush.

"It just strikes me as incredibly self-defeating,'' said Heath. "If she wants to be a Liberal, why doesn't she run for the Liberals?''

Dion and May have been discussing various ways in which their two parties might co-operate during the coming election. Dion has said he believes May should be allowed to participate in the televised leaders' debates, even though her party has never won a seat.

However, with May and Dion now openly collaborating, there's little chance the Tories, NDP and Bloc Quebecois will agree to include the Green leader in the debates.