Plans to restructure the flagship online venture for UK universities will be decided this week.
The Higher Education Funding Council for England was due to discuss a revised plan for the UK e-University at its board meeting on Friday. A Hefce spokesman said some decisions about its future had been made.
The Times Higher revealed last month that Hefce had ordered the UKeU to be restructured because of poor student recruitment and cash problems.
The spokesman said there was no risk that the business would be wound up.
Instead, he said, a revamped UKeU would focus on "public good" aspects of virtual learning rather than on making money.
UKeU has not been a commercial success, attracting 900 students over four years against a target of 5,600 for the first year alone.
It made £4.5 million selling degrees online, but had been expected to match the £62 million in public cash it received from Hefce.
When the venture was launched in 1999, David Blunkett, who was then education secretary, said the UKeU would "meet the competitive global challenge thrown at UK higher education".
Hefce blamed the UKeU's problems on the global economic downturn and slow growth in demand for online courses.
But a survey published this week - based on the responses of more than 150 lecturers across a range of subjects ranging from bioscience to history and music - shows that more than 85 per cent of lecturers now believe online teaching improves students' academic success and that 83 per cent of them get positive feedback from their students about the benefits of e-learning.
Carol Vallone, president of e-learning provider WebCT, which commissioned the survey, said students expected to find an e-learning environment at university.
"More and more institutions are realising that teaching needs to become more accessible if student success rates are going to remain high," she said.
But despite its popularity among students and lecturers, an effective formula for the future of e-learning is still some way off.
Diana Laurillard, head of the e-learning strategy unit at the Department for Education and Skills, said the issues were difficult and would take some years to resolve. Speaking at a conference organised by lecturers'
union Natfhe this week, Professor Laurillard said: "We have a complex set of technology models, and the UKeU was a brave attempt from which a lot has been learnt."
Professor Laurillard said the DFES was working towards a unified e-learning strategy that would join up fragmented methods of working across different sectors of education and employment.
Liz Allen, higher education official at Natfhe, said that to develop e-learning successfully, the experience of staff needed to be taken into account.