Ministers have been urged to "end years of dithering" and set out a clear timetable for airport expansion.
Last July, the Airports Commission had recommended a third runway be built at Heathrow.
In December the Department for Transport confirmed that the shortlisted options - new runways at Heathrow or Gatwick or the extension of an existing runway at Heathrow - were "viable".
At the time, it was decided that more work needed to be done on noise, pollution and compensation before a decision was made on which project to support. This is expected to be concluded during the summer.
But Louise Ellman, chairman of The Commons' Transport Select Committee, has criticised the Government for confirming "what was already known".
Labour MP Ms Ellman said that, with dozens of new runways being planned at airports around the world, the UK's standing in global aviation was under threat if the Government continued to procrastinate.
She said: "The months ticking by constitute time wasted for the UK's economic prosperity.
"UK PLC needs to know that a decision will be taken. Doing nothing means the UK continues to lose out."
"The Government must make up its mind.
"The decision on location is not the end of the process - it is the start of one.
"Real progress cannot begin until the location is declared.
"Work on environmental issues can run in parallel with other pre-construction work."
Her words echo those of Willie Walsh, chief executive of International Airlines Group, which is the parent firm of British Airways.
Mr Walsh said in December that he would focus expansion away from Heathrow if the Government continued to "dither" over a third runway.
Meanwhile, the Department for Transport said: "The case for aviation is clear but it's vitally important we get the decision right so that it will benefit generations to come.
"As well as progressing the package of further work announced in December, the Government will continue to consider (the Airports Commission's) evidence before reaching a view on its preferred scheme."
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