Halter's spokesman provided a statement Monday in which the one-term lieutenant governor said he would file papers this week for the U.S. Senate. Halter is the only Democrat to formally announce a challenge to Lincoln, a moderate who has been under pressure in Washington to support President Barack Obama's health care overhaul.
"Washington is broken. It's working for the special interests, not Arkansas families," Halter said in the statement.
Lincoln has become emblematic of the problems faced by Democrats, and more broadly, incumbents, in the 2010 campaign. She is considered by some political handicappers to be the Senate's most vulnerable member.
Eight Republicans already have announced interest in Lincoln's seat as her popularity wanes in the GOP-leaning state. Groups on the left have criticized her stances on labor, health care and air pollution regulations.
"I know that I am the target of both political extremes, but that's what makes this campaign so important to all of us," Lincoln said in a statement released by her campaign. "This Senate seat belongs to Arkansas, not to outside groups that are angry I don't answer to them."
Halter is a former Clinton administration official, having served as a deputy commissioner and acting commissioner of the federal Social Security Administration. He was elected lieutenant governor in 2006 after briefly considering a run for governor against Mike Beebe, who won the post.
Arkansas' filing period opens Monday; Halter is expected to file Tuesday.
He provided few details in the e-mail statement Monday.
"I cannot stand by while jobs are shipped overseas, seniors are pushed to the brink and big banks and insurance companies get bailed out while Arkansans are left to pay for a mess we didn't create," Halter said.
Halter last year helped arrange a one-day free medical clinic in Little Rock organized by the National Association of Free Clinics. The medical clinic had been promoted by MSNBC's Keith Olbermann as a not-so-subtle jab at Democrats to support their party's health care reform efforts.
Lincoln has voted for the Senate version of a health care reform bill but has said she is opposed to a government-run health insurance option as part of the overhaul.
She has opposed key union-organizing legislation and opposed Obama's nominee for the National Labor Relations Board. Both positions have gained the ire of the Arkansas AFL-CIO, which backed her re-election bid six years ago.
Lincoln has worked hard to insulate herself from the souring mood as voters become impatient with the lack of jobs, the soaring federal deficit and elected officials who seemed locked in partisan infighting.
She's been virtually running against her own party's agenda on controversial issues such as the health care overhaul and ambitious spending proposals. For instance, she has said she opposes using a special budget-related procedure to go around GOP health care overhaul opposition in the Senate - which is now emerging as the Democratic strategy for getting a final bill.
The tactic has drawn the ire of Democratic activists who are now publicly criticizing her. Meanwhile, her centrist approach doesn't seem to be winning over conservatives, with a growing field of Republican challengers in the race.
Lincoln finds herself the target of well-funded attack advertising from both sides of the political spectrum.
Her ability to withstand the crossfire is considered a sign of the Democratic Party's ability to maintain a foothold in Republican-leaning states in the election.