Downing Street is increasing the pressure on big cities to transform the way they are governed - by offering greater funding and autonomy if they create an elected mayor.
Chancellor is to offer England's major cities a deal designed to encourage them to introduce a new political system. He will set out the proposals in November.
The decision to focus on mayors illustrates the Conservative Party's renewed commitment to creating directly elected city leaders.
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It follows referendums in 2012 when voters in Birmingham, Coventry and seven other cities including Manchester, Leeds and Newcastle rejected the idea of a city mayor.
Polls were held in 10 cities but the campaign to create a even though elected leaders were championed by David Cameron.
Councillors in Leicester and Liverpool both chose to move to a mayoral system without a referendum.
It is unclear how this time but there has been no talk of a referendum.
Instead, Mr Osborne appears to be hoping more councils will choose to adopt a mayor voluntarily, in return for clearly specified powers and extra funding.
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Speaking to council leaders from the North of England, he said he would "set out ideas for a major transfer of powers and budgets" to cities that were willing to move to a mayoral system.
He said: "I know it's controversial with some and the local politics isn't always easy but almost every major global city has a single mayor and it's the view of many different people who've looked at our cities here and say it's time we did the same.
"Before deciding in advance how to respond, wait to see what I am offering in return."
Mr Osborne highlighted the work that cities minister Greg Clark had already carried out to devolve power.
Mr Clark is a vocal supporter of city mayors and since the last cabinet reshuffle he has attended cabinet meetings.
The Chancellor said: "Wait to see how we will build on the work our cities and universities minister, Greg Clark, now sitting around the cabinet table, has done with all of you on city deals and growth deals. We will not disappoint."
He made the comments as he urged cities such as Manchester, Liverpool, Leeds, Newcastle and Sheffield to join forces and become a "Northern Powerhouse".
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However, officials say there is no reason why powers offered to the north couldn't also apply elsewhere.
The comments suggest ministers have taken on board criticisms from 2012, when supporters of a mayor in Birmingham said the Government had failed to set out what a directly elected leader would actually be able to do, and said this had contributed to the 'no' vote in the referendum.
Mr Osborne also promised that proposals to extend the high-speed rail network linking Birmingham to London, Leeds and Manchester would move ahead swiftly.
Sir David Higgins, executive chairman of is considering proposals for a trans-Pennine extension from Leeds to Manchester, giving the North East and North West a direct high-speed link. Sir David will report his findings in October.
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