Plans for mass burials are being considered as part of Home Office preparations for a possible bird flu pandemic, reports the Sunday Times.
The use of anti-viral drugs may be one way to deal with an outbreak
It cites a confidential report that says a "prudent worst case" assessment suggested 320,000 could die if the H5N1 virus mutated into a human form.
The document warns "there are likely to be substantially more deaths than can be managed within current timescales".
The Home Office said it did not respond to leaks but is making preparations.
A spokesman said: "Prudent precautionary planning is under way across all elements of the response, including the health service, other essential services and local authorities."
The H5N1 virus, which causes bird flu, does not pose a large-scale threat to humans, as it cannot pass easily from one person to another.
Experts, however, fear the virus could mutate at some point in the future, and in its new form trigger a flu pandemic, potentially putting millions of human lives at risk.
Any such mutation and subsequent pandemic would lead to delays of up to 17 weeks in burying or cremating victims, the document - said to have been discussed by a cabinet committee - states.
And the document warns the prospect of "common burial" would stir up images of the mass pits used to bury victims of the Great Plague in 1665.
However, it "might involve a large number of coffins buried in the same place at the same time, in such a way that allowed for individual graves to be marked".
The report suggests town halls could deal with what it refers to as a "base case" of 48,000 deaths in England and Wales in a 15-week pandemic.
Entitled Managing Excess Deaths in an Influenza Pandemic and dated 22 March, according to the Sunday Times the document says vaccines would not be available at least for "the first wave" of a pandemic and would not be a "silver bullet".
The newspaper claimed ministers discussed the issue last week and, although they were alarmed at the prospect of such delays to burials, accepted there might be no option in the event of a mass outbreak.
Bird flu has already prompted the slaughter of millions of birds across three continents since the H5N1 strain emerged three years ago.
And it has claimed the lives of more than 100 humans - all of whom had been in close contact with infected birds.
Chief Medical Officer Sir Liam Donaldson has said preparing for a pandemic was "a top priority" and "strong plans" were in place to respond.
These plans include building a stockpile of 14.6 million doses of anti-viral drugs to treat those who fall ill during a pandemic.