A pioneering 'Civic Univer-sity' could be open in Bradford within two years.
College and university bosses have backed outline plans for the two institutions to merge.
The ruling bodies at the city's university and Bradford College agreed that a merger could boost student numbers and increase access to higher education in the city.
They have now ordered detailed plans to be drawn up explaining how the new institution would look and what the implications would be for staff and students.
If the plans are approved, bosses hope to attract new funding to finance a major building programme which could transform the face of the existing campus.
A final decision will be made in October and the new university could be up and running as early as 2004.
Alan Hodgson, principal of Bradford College, said the merger could create a "synergy and excitement" that would rejuvenate higher and further education in the city.
The two institutions have been prompted into action by tumbling student numbers at the university, with admissions down 19 per cent last year.
Mr Hodgson told a meeting of the Bradford Education Policy Partnership a merger was the favoured option among three proposals included in a feasibility study published this month.
"The study concluded that a merger would be the option which would create the kind of synergy and excitement that is necessary to create the growth and investment we need," said Mr Hodgson.
Martyn Spence, spokesman for the feasibility study project office, said the merger could be a "tremendously exciting opp-ortunity".
He said the new institution would be ground-breaking and offer a range of education provision from basic English-language skills to doctorates and world-leading research.
A survey of staff and students and research into the costs of such a merger is now to be carried out, along with talks with external bodies, before a final decision is made.
Officials will then approach Government funding organisations to thrash out details of how the new institution will be financed.
A spokesman for the Higher Education Funding Council for England confirmed it would back the plans provided the quality of provision was maintained.
Mr Hodgson said he believed the new institution could be a key driving force for improving post-16 education in Bradford, but admitted it had been a difficult process.
"It is a serious and very complex issue which we are exploring," he said.
"Bradford College has been here for 170 years and we are embarking on a path that might lead to it becoming a part of a larger institution.
"It has been hard to convince some external bodies that this is not all a done deal, but neither the college nor the university is yet committed to a merger."
Pictured are Dr Gordon Lakin, left, of Bradford College, and Professor Jeff Lucas, of Bradford University, who could be joining forces.
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