The Olympics organizing committee is aiming to settle its overall budget for the 2020 Summer Games at around ¥2 trillion, according to sources with knowledge of the cost-cutting process.
The target is ¥1 trillion less than the figure released by the Tokyo Metropolitan Government earlier this month.
The International Olympic Committee had said in October that ¥3 trillion was a "very large" estimate.
The second meeting of a four-party working group, comprising high-ranking officials from the IOC, the national and metropolitan governments and the organizing committee, is set for next Tuesday, when a draft budget can be officially announced.
A technical meeting to iron out the details may be held Sunday ahead of next week's talks.
The organizing committee declined to address the ¥2 trillion figure.
"With respect to the reduction of the overall costs, we are working toward the meeting (of the working group) at the end of the month," the committee said in a statement.
"As we have said all long, we hope to have the first version of the budget and the overall costs ready by the end of the year."
During the first meeting of the working group from Nov. 1 to 3 in Tokyo, organizers were told by the IOC that the figures they proposed were too high. No details of the meeting have been made public.
When Tokyo presented its bid to the IOC in 2013, costs were set at ¥734 billion, roughly one-third of the latest estimate.