According to the reports, Shinde signed the papers just before the scheduled meeting of the Union cabinet.
Sources said that Shinde signed the note after he received a green signal from the Congress President and United Progressive Alliance chairperson Sonia Gandhi. There are indications that the note will come up for consideration by the Union cabinet later in the evening.
Sources said that the note contained the proposal of formation of Telangana state comprising 10 districts and Hyderabad as its capital.
Earlier in the day, Shinde had dismissed reports that the cabinet will discuss the Telangana note on Thursday.
Tension flared up across the Seemandhra regions of Andhra Pradesh and security forces went on a high alert to keep the situation under control.
The state police as well as the central paramilitary forces were alerted in 13 Seemandhra districts which has been witnessing unrelenting agitation for the last 65 days against the proposed bifurcation.
As the situation took a dramatic turn in the evening, with the Union Cabinet suddenly taking up the T note, the leaders of the anti-Telangana agitation were stunned and were finding it difficult to react to the development.
On July 30 UPA partners and then Congress Working Committee gave their nod to decades-old demand for a separate Telangana state. However, the absence of any visible action by the central government since then had given some hope to Andhra leaders that the centre was going slow and may not take up the formation of Telangana state at this stage due to the agitation.
Nearly six lakh government employees were on an indefinite strike as part of the agitation since August 12. But in the end it all proved futile as the UPA government decided to walk the talk on Telangana.
Telangana note ready; CM Reddy to go
10 things you must know about Telangana
Why the formation of Telangana is Congress's 'great gamble'
Why Congress finally said YES to Telangana
The bumpy road to Telangana