Up to 200 jobs could be lost at Middlesex University as part of plans to save at least £5 million after a "very disappointing" funding settlement and problems collecting student debt.
To underline the severity of financial problems, staff were told to avoid photocopying and printing and to switch off lights whenever possible.
Vice-chancellor Michael Driscoll told staff this week that "steps would need to be taken in all areas to reduce expenditure if the university is to stand any chance of avoiding a significant deficit".
In a circular, Professor Driscoll said the university's income for the financial year to July "is running at about £1 million less than predicted, mainly because past and present students owe us money".
He said "expenditure is not declining as fast as expected", despite earlier measures to cut staff numbers. The university recently shed 90 posts.
But he said the financial implications for next year were "very serious", because of a "very disappointing" 2.8 per cent increase in the grant from the Higher Education Funding Council for England.
"If the university is to cover the cost-of-living pay rise in line with other public-sector workers, and to meet the unavoidable cost increases, savings of at least £5 million will need to be made in pay and non-pay budgets. This could mean reducing the number of posts in the university by between 100 and 200."
He said the cuts would "not be easy" and a tremendous effort would be needed to avoid redundancies.
A spokeswoman said: "Middlesex University is not alone in having to undertake cost-saving activities in the light of its very disappointing Hefce settlement. Michael Driscoll's message to staff begins a time of consultation on efficiencies and, unfortunately, the probable loss of more posts.
"The development strategy - by which the university will consolidate on fewer, larger campuses, dispose of its smaller sites and invest more in its IT infrastructure - is one of the university's key strategies to ensure a healthy future."
At the same time, staff in the university's business school, which is itself heading for a deficit of more than £100,000, were told to make a series of economy measures.
Staff were told by business school head Dennis Parker to make fewer telephone calls, "seriously consider and adopt the principle of a paperless meeting", circulate less paper, turn off lights and switch off computers when they are not in use.