In a stunning political turnaround, sources briefed by Mayor Michael Bloomberg told the Associated Press and the New York Times Tuesday that he will announce his candidacy for a third term as mayor later this week.

Bloomberg, whose mayoralty must legally end in January 2010, will push to repeal the term limit law that currently prohibits the city's mayor from serving more than two terms.

Any change in term limits would have to be approved the City Council.

The mayor refused to respond to any questions as he walked into his home Tuesday night.

Bloomberg, a multi-billionaire, is expected to argue on Thursday that the city's financial crisis requires his ongoing leadership.

"Number one, he told the truth. He said we were going to be in bad shape," said one supporter. "We were heading for a decline in revenue and a shrinking economy. And he was right. He was pro-active. He did the unpopular thing, which was to cut services and raise taxes temporarily."

"I think right now, with the state of the economy, he's the man we need in there," said another. "He's a good business man. He's always proven that. He knows his economics, so if anybodys going to be in there, I'd like it to be him."

The move would completely recast the 2009 mayoral race, and has already raised protests from several of those who are expected to vie for the mayoralty next year. They include City Comptroller William Thompson, who has been a vocal critic of extending term limits for Bloomberg's benefit.

"I think for the mayor or the members of the City Council to vote for something to benefit them is self serving; let's be blunt," said Thompson this afternoon. "It’s a terrible idea to be done through the City Council. Go back to the people of New York City and ask them. And it can be done. You can put a special election on the ballot, go back before the voters and ask them what they think."

Voters have twice supported the current term limit law.

New Yorkers who spoke with NY1 had mixed reactions to the idea.

"I think Bloomberg is doing a great job, and with the economy here, I want somebody who can manage the finances of the city," said one New Yorker. "And I think he's a good guy for the job."

"I'm a big fan of term limits, let me tell you, because I think you always should have new blood in there," said another. "You get in there to long, you just get stale."

"The mayor should only be in there for a certain period of time," said a third. "You should be able to move on and let someone else have a fresh approach, a fresh look."

"I think he's a great mayor, and I think we could use him for a third term, but I don't think you should twist the law around for your own benefits," argued another.

Politicians on both sides of the aisle also had varied responses to the news.

In a statement released Tuesday afternoon, Public Advocate Betsy Gotbaum called a third term, "an insult to the democratic process and a slap in the face to New Yorkers to now render those votes meaningless."

A spokesperson for Democratic Brooklyn-Queens Representative and current mayoral candidate Anthony Weiner said that the congressman is still continuing his bid for office.

"This is highly speculative. It's illegal to run for a third term," said Weiner's spokesperson. "Currently, Anthony is fighting for a congressional recovery plan that will help our city, our middle class, and our country in the midst of an economic battle. It is important we put that effort first for the city we all love."

Former Mayor Rudolph Giuliani weighed in, as well – expressing support for modifying term limits, but was more cautious on whether Bloomberg himself should run.

"Personally I've always thought three terms would be a good limit rather than two; that's my own personal feeling, maybe even supported it at one time or another," said Giuliani. "But you do have the people saying twice what they want. But, on the other hand, we have a very good mayor and a very difficult time, and I want to hear what Mike's thinking on it before I say something on it and act prematurely."

The mayor earned some a major re-election supporter Tuesday. Billionaire Ron Lauder, who pushed for the two-term limit law in 1993, said today that he would back a one-time extension to allow Bloomberg to run for a third term.

The cosmetics mogul said the city needs Bloomberg to get through the current fiscal crisis.

Support from Lauder, who ran for mayor back in 1989, could ease fears about big business's opposition to an extension.

Bloomberg also got the backing of former New York City mayor, and NY1 "Wise Guy," Ed Koch, and former New York State Senator Alfonse D'Amato.

During their weekly appearance on "Inside City Hall" Tuesday night, they attacked fellow NY1 "Wise Guy" and former New York City Public Advocate Mark Green, when he criticized Bloomberg's reported move.

"Thursday, Mike Bloomberg will announce he intends to engage in an illegal act," said Green.

"He's engaging, said Mark, and I'm using your language 'in an illegal act.' That's ridiculous, ridiculous," said Koch. "Why do you want to smear people that way?"

"By the way it's not illegal if the City Council permits him," D'Amato added. "To say it's illegal is nonsense."

Green says some civil and labor officials will mount a pro-term limits campaign if Bloomberg seeks to overturn the law.

If Bloomberg is re-elected in 2009, he would be the fourth city mayor to win a third term. Three mayors did so before the current term-limit law was enacted 15 years ago.