Lancaster University plans to axe its art department and concentrate investment in music and theatre studies instead.
A closure recommendation by the university's management advisory group follows a review of the sustainability of creative arts at Lancaster.
The axe looks set to fall on the art department because it scored a 3a in the 2001 research assessment exercise. Departments rated below 4 generally receive no funding council research cash, making them difficult to sustain.
The university's music and theatre studies research was awarded a 4 in the 2001 RAE. It is hoped that investing cash that would otherwise have gone to the art department will help these areas secure a 5 or 5*-rating in the next RAE in 2008.
Voluntary redundancies are possible, the university said, although it has ruled out compulsory redundancies. It said that all commitments to existing students would be met.
The move has been condemned by students, who were planning to fight the closure, union president Warren Nettleford said.
"This has come as a shock to staff and students and is particularly worrying for undergraduates who were in the middle of their exams and degree shows when the news broke," Mr Nettleford said.
"There has been no consultation and, whatever the university says, staff will leave the department before closure. Where does that leave the students? We are fed up with executive decisions being forced on us."
The department has five full-time staff and takes about 35 students each year. It offers an unusual mix of practical and academic study offered in only a handful of institutions in the UK.
A university statement stresses the strategic nature of the decision, which it says was driven by "broader considerations in a time of constrained resources". The university is consulting with staff, trade unions and students.