With nine months before Britain leaves and just over three before the EU says it wants a deal, May has been under intense pressure from the bloc and from many businesses to show her negotiating position.
As she held the crisis talks with her ministers, the chief executive of European planemaker Airbus, Tom Enders, accused the government of having "no clue or at least consensus on how to execute Brexit without severe harm."
The EU's chief Brexit negotiator Michel Barnier also made his feelings clear in Brussels, by telling May "there are still too many questions and too few answers".
He did not comment directly on her new plan, which had not yet been detailed in full, but suggested it may fall short.
May was cautious on whether she will win the support of the EU, saying only that she had "been talking to European leaders over the last week or so".
"This is a proposal that I believe will be good for the UK and good for the EU and I look forward to it being received positively," she told reporters.
But she has at least cleared yet another domestic hurdle.
She seems to have reassured pro-Brexit ministers that under the new negotiating position Britain will still be able to seek trade deals with the rest of the world, easing fears that mirroring EU rules for goods would rule that out.
That fear was felt so strongly that Brexit campaigner and foreign minister Boris Johnson convened a crisis meeting of like-minded colleagues late on Thursday to discuss strategy to counter May's plan.
They may also have been reassured by May reiterating her belief that any agreement with the EU should end the jurisdiction of the European Court of Justice, although British courts would still have to "pay due regard" to its rulings.
And the agreed negotiating position also hands a big role for parliament to decide whether Britain should continue to follow EU rules and regulations, recognizing that any rejection of them "would have consequences".
"This is a further step, an important further step, in our negotiations with the European Union," she said. "But of course we still have work to do with the EU in ensuring that we get to that end point in October. But this is good."