If political talks at Stormont fail to deliver a powersharing government, Jeffrey Donaldson said the party “will be out to win” at the ballot box.
However, the DUP stalwart said he believes the region is more likely to be heading for direct rule than another election.
“We can’t rule out the possibility of another election and if there is one the DUP will engage and we will be out to win,” he said.
But Mr Donaldson added: “The reality is an election won’t resolve any of the issues.
“They can only be resolved through negotiation and if Sinn Fein aren’t prepared to negotiate, then most people will conclude ‘what is the point in having another election?’
“I think the more likely outcome is direct rule, but clearly that’s a decision for the UK Government.”
There has been a break in talks between the Stormont parties over the Easter period. Negotiations to try to resolve the deadlock are set to resume tomorrow .
Northern Ireland Secretary James Brokenshire has said he will either trigger an election or move to a return to Westminster decision-making if there is no deal by “early May”.
Mr Donaldson claimed that the rhetoric of Sinn Fein in recent days does not bode well for the restoration of the devolved institutions.
On Sunday, Sinn Fein’s leader in the north, Michelle O’Neill, told her party’s Easter Rising commemoration in Dublin that Brexit has placed Irish unity back on the political agenda.
And party president Gerry Adams told an Easter Rising commemoration in Tyrone that DUP leader Arlene Foster must reflect “on whether she wants to reinforce unionist separation, segregation, from the rest of us or whether she seizes the opportunity to bring unionism in a new direction to respect diversity and end division”.
He also said direct rule was not an option and that another snap Assembly election was the only way to proceed if negotiations do not deliver agreement.
Mr Donaldson said if Sinn Fein does not change its approach “the most likely outcome at this stage is direct rule”.
“After the speeches at the weekend I am not hopeful of a change in Sinn Fein’s approach,” said Mr Donaldson.
He added: “Our priority is to form a devolved government. That is what we were elected to do. That is what all the parties were elected to do.
“If we do return to direct rule, Sinn Fein will have to explain to their voters why they would prefer to be ruled from Westminster than to have a government in Northern Ireland. There is still time but we have to be realistic. It will have to involve a change in attitude from Sinn Fein and serious engagement by them to try and reach an agreement and we haven’t seen that so far.”