Japan has been able to use a clause in the IWC moratorium allowing it to conduct "research" hunts every year and to sell whale meat on the open market, although consumption has plummeted in recent decades.
But Masayuki Komatsu, a former fisheries official who represented Japan at IWC, questioned if Japan gains anything from withdrawing.
The move drew a swift rebuke from Australia; and other anti-whaling countries will likely condemn the plan, as well, The Guardian reported.
Anti-whaling nations are expected to react sharply, which could strain Japan's global ties.
Japan halted commercial whaling in 1982 in line with a moratorium adopted by the IWC.
The IWC was established in 1946 to conserve and manage the world's whale and cetacean population.
In the past, Japan attempted to get permission to commercially hunt just those whales that have greater numbers in the wild, such as the common minke whale (Balaenoptera acutorostrata), which is listed as an animal of "least concern" by the International Union for Conservation of Nature (IUCN).
In response to being voted down, the government delegation expressed the possibility that Japan could withdraw from the IWC, saying, "If the IWC does not permit any form of commercial whaling and there is no potential for two different stances or ideas to coexist, Japan cannot help but assess all possible options".
Kitty Block, head of the Britain-based Humane Society International, said that if Japan resumed killing whales in the North Pacific, it would be "operating completely outside the bounds of international law" and "pursuing the path of a pirate whaling nation".
Japan will inform the IWC of its decision by the end of the year, according to Kyodo news agency.
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Japan joined the organisation in 1951. Supposedly they wanted to waters, however, only in the own coast, as well as in Japan's economic zone, to go on whaling.