When confronted with a Turner Prize nomination, with all the attendant attention and the prospect of going head-to-head in competition with their fellows, some artists shy away. Not so Nathan Coley. "I found it quite easy to say yes," he says, taking a break from installing his work at Tate Liverpool, "because it's an accolade, because some really great artists have been nominated in the past - it's good to be associated with that level of work - and, honestly, because it brings a huge audience to my work. In terms of the work that I'm making, I feel that it's a good time to be shortlisted, too."

On that last point, Coley is dead right. Not that his recent work has reached a new plateau, instead he is at a stage in his career when past pieces and present projects seem to be gelling together, revealing resonances, some surprising.

This is apt. Coley's sculptural objects and installations are, more often than not, deceptively simple, marked out by a tendency to develop slowly, disclosing new layers of meaning, long after the viewer first encounters them.

"With individual pieces of work," Coley explains, "I neither seek to steal the show, nor am I interested in one-liners. My intention is for the work to have a number of ideas, a number of references."

A good example, both of this deceptive simplicity and the increasing interconnections between his work, could be found at Coley's recent outing at doggerfisher, Edinburgh. Untitled (Threshold Sculpture), a slim beam of wood that blocked the entrance to the gallery, forced visitors to take care in stepping over it on their way into the space. "You can look at that work as being just a piece of wood on the floor," Coley explains, "maybe in the context of minimalism, but then you start thinking about the whole notion of the space you're entering and the space you're leaving, and then it's made of oak, which has a particular spiritual history and is, architecturally, used and loved by modernists."

Coley also sees the piece - which formally has little connection to works that have gone before - as closely linked to the work which first drew wide attention to his practice, a reconstruction of the witness box at the Lockerbie trials, made when he was "unofficial artist" at the Hague.

"It's about the control of space, a demarcation of space, even though there's no resemblance. Both come from my interest in how we show who we are through the architecture of our spaces."

This talk of an innate connection between a block of oak and a witness box might make Coley sound like an arch-conceptualist, with little interest in the physical manifestations of his ideas, but nothing could be further from the truth.

"It's a nice contradiction," he admits. "On the one hand I'm a person who makes objects, but I don't think of that being the centre of the work. The object is somehow a mechanism to make the idea come to life."

Indeed, he is close to incensed by references in the press to his piece We Must Cultivate Our Garden, the last line of Voltaire's novel Candide illuminated and installed atop a building on St Andrew Square in Edinburgh, being made of neon. "I took a lot of time and energy not making them neon!" he says. "Neon has a long history in contemporary art, but I wanted to find something that had common or folk associations, so the light-bulbs are fairground light-bulbs, which means that the gravitas of the text is contradicted by the circus is coming to town' feel of the piece. So you have one of the masters of the Enlightenment meeting the fairground and the football pitch."

That installation, and his best-known work, Lamp of Sacrifice, 286 Places of Worship, Edinburgh - anonymous cardboard sculptures of every church listed in the Edinburgh Yellow Pages - point to a trait Coley shares with his fellow nominees, especially Mark Wallinger and Zarina Bhimji: an avowedly political bent.

"Some people see a work like Lamp of Sacrifice as a celebration of faith," Coley says. "But for me it's the absolute opposite.

"With We Must Cultivate Our Garden, that last line has been discussed at great length as being anti-church, anti-royalty and as being a call to arms for self-determination. So it's no accident it's on St Andrew Square, named after this supposed saint of this supposed religion, Christianity."

As for the big question - who will take the prize? - Coley is sanguine. "The shortlisting is the thing that I'm excited about, not least because I have great respect for the other three who are shortlisted," he says.

"The winning or the losing is a whole other thing, to do with the personal taste of the judges, to do with things that are outwith my control."

  • The Turner Prize show opens at Tate Liverpool on Friday.