Lundergan Grimes hasn't made a decision on the race, and she reportedly may wait until late summer before announcing her intentions.
"I do think that it is important that Alison Grimes immediately decide whether she’s running or not because there are a number of people sitting on the sidelines who would be interested, I think, in making a race who are waiting to find out what she does," Yarmuth tells a local radio station.
"And for her to keep prolonging this, as she said, possibly until the late summer, I think is a disservice to the party."
Lundergan Grimes is Democrats' favored recruit to take on McConnell in the heavily conservative state and is considered to be the only candidate who might be able to run a competitive race against him.
The Democratic Senatorial Campaign Committee has focused on her as their top Senate prospect in the state ever since actress Ashley Judd (D) decided against a bid, and many in the state have long preferred her as an option for the race.
A Democratic poll released Tuesday found her tied with McConnell at 45 percent apiece, though the poll's sample size appeared to skew fairly Democratic, likely leading to a more favorable result for the potential candidate.
McConnell has millions in the bank, and Lundergan Grimes risks hurting her ability to raise money and build name recognition if she waits too long to enter the race.
"I think she has to say she’s in or out because, again, there are other people who would seriously consider the race, and they’re waiting to hear on her," Yarmuth continues.
"So I think it’s incumbent on her to make a decision within the next few weeks."