Academics at Oxford University have voted against reforms which could have handed financial control to outsiders.
The vice-chancellor's proposals have faced some opposition
Vice chancellor John Hood wanted to change the 900-year-old tradition of its self-governing council and bring in external members to oversee finances.
But his plans took a knock when members of the ruling body voted 730 to 456 against them.
Members have six days to call for the matter to go to a postal ballot which could potentially reverse the result.
There are currently 25 members of the university council - including four lay members - responsible for both academic and financial matters.
Dr Hood proposes to replace this with separate academic and financial boards.
His proposal is for the council running the university's financial affairs to be composed of seven external and seven internal members plus a chairman - who would be the chancellor, Lord Patten, for the first five years.
After that, an existing external member of council becomes chairman.
A compromise amendment agreed by 652 votes to 507 earlier this month would make it possible for the replacement council member to be an internal candidate.
However, critics say that the internal majority would include the vice chancellor and the representative of Oxford's colleges - so Dr Hood would still have control.
Oxford's parliament - the Congregation - voted on the amended proposal at the university's Sheldonian theatre on Tuesday following a three-hour debate and nearly 30 speakers.
However, since the theatre could accommodate no more than 1,200 of the 3,700 members of the parliament a postal ballot can now be held.
Either the council can call for a postal vote or 50 members of the Congregation have until 4 December to request one.
Following the result, Dr Hood said: "We are engaged in a lengthy and complex democratic process which has clearly reached an important stage."
Lord Patten has said that without reforms it will be harder to raise private money that the university will need to support students from poorer backgrounds.
But opponents fear such reforms threaten to undermine the ancient university's academic standing and want university insiders to retain control on the council.