The University of Hertfordshire hopes to have a medical school by 2010. A meeting between the university and key National Health Service partners last week agreed to establish a working group to take the idea forward.
Michael Pittilo, pro vice-chancellor at the university, said: "The strategic health authority and local workforce development confederation are fully behind the idea."
The NHS primary and acute trusts in Hertfordshire have recruitment problems, with many medics and other healthcare staff attracted to the London teaching hospitals. The university has more than 4,000 nursing students and teaches most of the allied health professions including substantial numbers of physiotherapy students.
The NHS is consulting on where to build a new hospital in Hertfordshire.The favoured site is adjacent to the university's new £120 million De Havilland campus in Hatfield.
"It would make sense to have a medical school near to such a new hospital," Professor Pittilo said.
In the last round of medical school expansion Hertfordshire put in a joint bid with the medical school at Imperial College London.
Professor Pittilo said: "The indications are that any fresh expansion is likely to be through existing medical schools but we believe that we can put forward a strong case for a medical school at Hertfordshire."
Hertfordshire has appointed a new vice-chancellor, Tim Wilson, who was responsible for putting together the private finance initiative to develop the De Havilland site.
"Traditionally, PFI was not thought suitable for building health facilities as many health courses were run on short-term contracts. However, the Department of Health is proposing indefinite revolving contracts and this opens up the possibility of PFI deals in this area," Professor Pittilo said.
Meanwhile, Hertfordshire has unveiled a £100 million redevelopment plan involving private finance. It would consolidate its Hertford and Watford campuses next autumn when De Havilland opens, 1km from its site at College Lane, Hatfield.
The plan includes accommodation for 500 students by 2004 and upgraded academic facilities. It would also include services for the local community such as a park-and-ride service and a football stadium.
Professor Wilson said the university did not expect opposition from the Hatfield community. But local newspapers have voiced residents fears' that the student accommodation would increase noise and spoil the view.
The plans have been put out for public consultation before the university applies for planning permission.