Part of a Microsoft R+D project called Alchemy Ventures, the Microsoft Surface tablet is reportedly being worked on by Xbox 360 veteran J Allard.
Microsoft Surface is the firm's table sized touchscreen device, aimed at restaurants, schools and other businesses. But the software could easily come to a tablet.
Earlier whisperings suggested that the new Microsoft Surface tablet will run software codenamed "Oahu".
Ohahu is a Hawaiian Island (home to Pearl Harbour rather inauspiciously) but also means "the Gathering Place". Could Microsoft's Surface Tablet be a stab at creating a touchscreen social media superstar?
Apple's expected to reveal the Apple Mac Tablet at an event in January and it is unlikely that we'll see Microsoft's challenger before then.
Commentators are speculating that Microsoft will wait for Apple to show it's tablet before revealing its rival in February.