Ceredigion Council is expected make up to 20 people redundant from its building and maintenance department. The local authority is asking for voluntary redundancies over the next few weeks after a fall in the department's budget for next year.
The council is using its reserves to cover a similar shortfall this year, but said that could not be sustained.
The authority said it had tried to resolve the issue without success, and that it was in talks with trade unions.
The building and maintenance department repairs council-owned properties.
Council leader Keith Evans said: "We're looking to make some redundancies, between 15 and 20, because of insufficient resources in the housing revenue budget for the next financial year.
'Every effort'
"There are insufficiencies this year, but the council is using reserves to cover the shortfall. However, we can't sustain this in the long-term."
The council said it was holding talks with trade unions in an attempt to identify savings.
A council spokesman added: "Every effort has been made to identify areas where savings can be achieved without having to resort to reducing the number employed within the unit.
"In the event that the unions cannot identify savings, then in the first instance volunteers for redundancy will be sought."
He added that the council may have to resort to making compulsory redundancies.