"Some technical problems cropped up during informal discussions between the seven-party leaders," said Ramesh Lekhak, minister of labour and a member of the government's negotiating team.
Negotiators had said that they had been expecting a breakthrough after Nepal's rebel Maoists agreed over the weekend to lock up their weapons and place them under United Nations supervision.
After six hours of "informal discussions" between the seven-party government and the rebels, the scheduled third round of talks were postponed, but would be resumed on Tuesday morning, Lekhak said.
"The seven party leaders could not reach a consensus on whether to decide the fate of monarchy through a constituent assembly election or a referendum," the minister said.
In June the rebels and multi-party government agreed to hold elections to a body that would rewrite Nepal's constitution permanently, a key rebel demand.
The exact role of the United Nations in the peace process, and what to do if the rebels did not give up all their arms also caused disagreement within the seven-party government, Lekhak said.
The two sides have been observing a cease-fire for just over six months, after mass protests forced King Gyanendra to end his direct control of the Himalayan nation.
This is the third time they have tried to hammer out a peace deal. Two previous attempts, one in 2001 and one in 2003, both failed, plunging the country back into conflict.
At least 12,500 people have been killed since the rebel Maoists launched their "people's war" in 1996.

Copyright AFP (Agence France-Presse), 2006