Spurgeon's College is appealing to universities minister Jo Johnson to review a decision by the Office for Students (OfS) to reject its application for registration.
The OfS is the official regulator for higher education institutions in England. Institutions must be registered with the regulator in order to be officially recognised as providing higher education in England and to access public grant funding from the OfS or from UK Research and Innovation (UKRI).
Registration is also required in order to apply to the Home Office to accept international students using the Tier 4 sponsorship licence, and to apply for degree awarding powers or a university title.
Spurgeon's College is a highly respected evangelical Christian college in the UK and has trained Baptist ministers for over 163 years, having been founded in 1856 in South Croydon, London.
The OfS passed the college on 4 out of 5 tests for registration but concluded that it did not meet its financial sustainability test.
In a statement, Spurgeon's said it "fundamentally disagrees" with the OfS's financial assessment of the college and claimed it had been made on "seriously flawed assumptions".
The college said that it maintained a "robust balance sheet" with "funds in the bank and plans for the future".
It is asking Mr Johnson to undertake a review into what it called a "flawed" registration process and added that it is considering taking legal action against the decision.
While the OfS's verdict does not mean that the college has to close, the college said it was a "significant blow".
"This unfair and misguided decision by the OfS means that some of our hardworking students will be negatively impacted," it said.
"In some cases, they will no longer be able to access any kind of student loan or financial help from the Student Loans Company. Those students still eligible for loans will not be able to access the full amount.
"It is important to note that no question has been raised regarding the high quality of the College's educational offer."
It continued: "The OfS decision won't stop this vital work, but it is a significant blow to the College and its students, and we believe it is contrary to Government policies encouraging diversification of the higher education market."