Apple is reportedly preparing to launch a smaller tablet computer in the coming months.

The Wall Street Journal reports that this is in a bid to maintain its edge in an increasingly crowded market.

It said the new tablet's screen would likely be smaller than eight inches (20 centimetres), compared to the 9.7-inch (25 centimetre) screen on Apple's market-leading iPad, launched in 2010.

The Journal cited unnamed sources as saying that component parts manufacturers had been ordered to gear up for mass production of the tablets in September, indicating the launch may be drawing near.

The newspaper cited one source as saying that Apple was working with screen-makers LG Display of South Korea and Taiwan's AU Optronics.

Apple has dominated the market for tablet computers since the release of the iPad but faces increasing competition as Samsung, Amazon, Microsoft and Google roll out competing devices.