Lohan was told to return to a Los Angeles court on March 10 to either accept a plea deal offered by

prosecutors, or go ahead with a full trial.

Los Angeles Superior Court Judge Keith L. Schwartz warned Lohan, 24, that if she accepted a plea deal on the grand theft charge "this case does involve jail time. Period. If you plead in front of me and the case is resolved in front of me, you are going to jail, period."

Lohan is accused of walking out of a Los Angeles jewelry store in January without paying for a $2,500 necklace. She pleaded not guilty at an initial hearing earlier in February.

Schwartz did not give details of the plea deal offered to Lohan, nor indicate how much jail time prosecutors want her to serve.

Lohan, dressed in cream pants and a low-cut black blouse, said nothing during Wednesday's hearing. If she rejects the plea deal offered by prosecutors, she will move ahead with a formal trial on the necklace theft charge, which would result in prison time if she was convicted.

Lohan faces a separate court hearing before a different judge on Friday for her 2007 drunk driving and cocaine possession conviction, which has halted her once promising Hollywood movie career.

She remains on probation for that conviction and in January completed a court-ordered stay in rehab -- her fifth stint in treatment in three years.

Schwartz said that if the jewelry theft charge is resolved in his court, he would recommend psychological counseling for Lohan as part of her sentence.

Lohan's father Michael spoke to the media after the hearing. He said he supported his daughter and put blame on the jewelry store.

"She's talks to me a lot, we go to dinner quite often. She's very concerned about this. She realizes that she takes chances," said Michael Lohan. "You can't just go into a store ... you can't let them say, here take this and go and get us some press on it, get us some exposure. And when they don't get the exposure they want, then what do they do, they get pissed off. Couldn't they have come back to Lindsay, couldn't they have called her. They know where she lives, she's right down the block. It's a $2,500 (USD) necklace that someone else had seen in a store for only $800. They put their own price tag on it, just like a lot of other stores do when she walks in."

Lohan made her name as an 11-year-old in the Disney movie "The Parent Trap" and went on to have hits with "Freaky Friday" and "Herbie Fully Loaded".