Rajoy said the application of the Constitution's Article 155 is the "only possible" response to restore the region's legality, which he said has been liquidated by Catalan President Carles Puigdemont's push to secede.
Responding to a question from a fellow MP, Rajoy insisted that he had always been willing to talk to Catalan leaders but was obliged to act in accordance with the law.
Catalonia is facing direct rule from Madrid from Friday, due to an independence bid which Spanish courts have ruled contravenes the country's 1978 constitution.
The Catalan parliament meets on Thursday to agree on a response to Madrid, and many analysts believe the economically powerful region could formally declare independence.
Spanish political and business leaders, along with most Catalonian newspapers, have urged Puigdemont to call a regional election before he is stripped of his authority.
They say direct rule from Madrid would be a humiliation for Catalonia and pose a serious risk of unrest.
Meanwhile Spain's Economy Minister Luis de Guindos told parliament an independent Catalonia would be forced out of the EU and euro area which would directly hurt the regional economy.
"It'd be out of all the treaties, 70 per cent of its gross domestic product would be subject to tariffs and physical borders. It would be out of the eurozone and the banks wouldn't have ECB coverage ... it would have to create its own currency which would be very depreciated," de Guindos said.
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