Hague said he would prefer to see the Libyan leader held to account at the International Criminal Court.
But he said a move into exile would create the kind of change that “most of the world and probably most of the Libyan people want to see”.
His comments came after allies met in London to discuss Libya’s future.
Meanwhile, Prime Minister David Cameron has written an article in the Arab press promising the international community will stand by the people of Libya.
Italy is talking to a number of countries about a possible deal which would allow Col Gaddafi to take refuge, possibly in another African state, in exchange for a ceasefire and transition of power.
In an interview, Hague did not reject the idea of Col Gaddafi going into exile.
“That is up to him. There is no doubt that if Colonel Gaddafi left power – wherever he went – there would be a major change in the situation, and that is what most of the world and probably most of the Libyan people want to see,” he said.
“That is up to him to decide. That’s not up to us to decide.”