The deadline was scheduled by the board during a 90-minute conference call, the board member said on the condition he not be identified. He said the union office was to issue an announcement later Friday.
When the board met in Chicago on Monday, it deferred a decision, hoping to spur talks without a deadline. But both sides made little progress on key economic issues during three days of negotiations.
The key issue blocking a settlement is a desire by owners to impose a luxury tax on high-payroll teams. The union thinks taking away too much money from the high-spending teams would slow salary increases.
"We're trying to find a way to resolve the whole situation," Chicago Cubs slugger Sammy Sosa said. "They set a strike date because I think things have been tough. We have to do what we've got to do. I think that's the only way we can get something done."
There was no immediate response from baseball Commissioner Bud Selig, who has pressed for major economic changes. Selig has said for a decade that the major leagues cannot survive without concessions from players.
President Bush, a former baseball team owner, served notice on both owners and players to understand the consequences of a strike, reports CBS News Correspondent Mark Knoller.
Speaking to reporters in Texas, the president said, "If there is a work stoppage, a lot of fans are going to be furious – and I'm one." He did not indicate that he had any plans to intervene and offered no proposals to break the deadlock. "They need to keep working," Mr. Bush said.
The last strike, in 1994, dragged on for 232 days and wiped out the World Series for the first time in 90 years. The walkout ended after a federal judge issued an injunction restoring the rules of the expired labor contract.
Players have gone on strike each of the last eight negotiations, primarily due to management's attempts to slow salaries in the free-agent era, which began in 1976.
The Aug. 30 strike date, the Friday of Labor Day weekend, means that if players walk out before the season ends they will lose 16.9 percent of their base salaries. Texas shortstop Alex Rodriguez stands to lose the most, $3,557,377 of his $21 million salary this year. A player at the $200,000 minimum would lose $33,880.
After meeting twice Thursday, the sides didn't even bother to schedule a bargaining session Friday, and people aligned with management and the union described the sides as far apart. Negotiators on both sides refused comment Thursday.
Owners originally proposed a 50 percent tax on the portions of payrolls over $98 million, then moved up their threshold last weekend to $100 million. Since Monday's meeting, management has moved up to $102 million, according to a player and two player agents who spoke on the condition they not be identified.
"I've gone from as optimistic as I can be to as pessimistic as I can be," Atlanta Braves player representative Mike Remlinger said. "It's back to just a flat out refusal to move."
Players don't want to finish the season without a contract, convinced owners would lock them out or change work rules. The union prefers to have a late-season stoppage, when more of the owners' revenue is at stake, than a confrontation at the start of next season.