"A Grand Alliance is possible in the state," Yadav told reporters when asked about possibility of such a coalition materialising in UP to take on BJP in 2017 assembly polls.
The chief minister, however, did not elaborate.
His remarks came a day after an Uttar Pradesh minister suggested a Grand Alliance involving ruling Samajwadi Party and Mayawati-led Bahujan Samaj Party for the upcoming assembly polls in the state similar to the one in Bihar where rivals Rashtriya Janata Dal chief Lalu Prasad and Janta Dal-United leader Nitish Kumar came together and decimated the BJP.
Like Bihar, the BJP had swept Uttar Pradesh also in Lok Sabha election last year and the party is hoping that it will return to power in the politically crucial state after nearly 15 years.
The chief minster, who was here on a private visit, said people in Bihar had given their decision in favour of development. In UP panchyat polls, they have favoured Samajwadi Party's development plank, Akhilesh Yadav said.
"We will contest the 2017 assembly polls on the plank of development as we have ensured progess in every nook and corner of the state," he said.
The grand secular alliance in Bihar comprising the RJD, the JD-U and the Congress secured over two-third majority in the 243-member Bihar house, winning 178 seats in the just-concluded assembly polls in the state. The RJD got 80 seats, the JD-U 71 and the Congress 27.
The BJP-led National Democratic Alliance managed just 58 seats. The BJP itself won 53 while its three allies the Loks Janshakti Party, the Rashtriya Lok Samata Party and the Hindustani Awam Morcha together secured only 5.
In Barananki, UP minister Fareed Mahfooz Kidwai had suggested that his party the SP and the BSP form a 'grand alliance' for 2017 assembly polls to defeat the BJP.
"God willing, a grand alliance will come into being here also (like in Bihar) and we will definitely defeat the BJP and form our government," he had said.
To a question if the SP and the BSP, which are arch rivals in UP politics, can come together on the lines of Bihar, Kidwai had said, "It is my wish".
The assembly poll victory in Bihar dealt a blow to the BJP and Prime Minister Narendra Modi.
Samajwadi Party chief Mulayam Singh Yadav had played the role of a peacemaker between the two backward class heavyweights -- RJD chief Lalu Prasad and his friend-turned-foe JD-U leader Nitish Kumar -- and they decided to contest the 2015 Bihar polls together.
However, Samajwadi Party had later pulled out of the Grand Alliance.