Britain's economy shrank 0.3% in the final quarter of 2012 and recorded zero growth for the year as a whole.
"After growth of 0.9% in third quarter, the economy contracted by 0.3% in the fourth quarter of 2012," the Office for National Statistics said in a statement on Friday, adding that gross domestic product growth was flat over the year.
"GDP is estimated to have been flat between 2011 and 2012," the ONS said.
AAP reports that if the economy shrinks in the current first quarter, then Britain will be in its third recession since the 2008 global financial crisis.
Chancellor George Osborne said the latest data was "a reminder today that Britain faces a very difficult economic situation." He added:
"A reminder that last year was particularly difficult, that we face problems at home because of the debts built up over many years and problems abroad with the eurozone, where we export most of our products, in recession.
"Now, we can either run away from those problems or we can confront them and I am determined to confront them so that we can go on creating jobs for the people of this country," Mr Osborne said in a statement.