Manchester City Council may challenge the government if plans to build a super-casino in the city are scrapped.
The panel recommended a super-casino be built in east Manchester
The city was a surprise winner when it was chosen as the location of Britain's first Las Vegas-style super-casino.
But Gordon Brown put the plans on hold and asked Communities Secretary Hazel Blears to carry out a review into other ways to regenerate Manchester.
Senior councillors have now said they would seek a judicial review if the casino plan does not get the go-ahead.
Council chief executive, Sir Howard Bernstein, said the team behind the review had not even visited the proposed site of the super-casino in Beswick.
An "open-ended invitation" had not been taken up, he said.
He said: "The evidence is clear that there is no other option for the site which could deliver anything like the same scale of jobs and investment.
"On the basis of this evidence we fully expect the regional casino to be approved.
"However, we have been frequently asked by the media whether we could consider a legal challenge if the regional casino does not proceed, especially if the 16 smaller casinos do go ahead.
"Clearly it is premature to give a definitive answer, but in this event we would be obliged to consider all the options available to do us in order to protect 3,500 jobs and more than £250m of private investment for Manchester, and east Manchester residents in particular."
Lib Dem Councillor Simon Ashley, the leader of the opposition, has supported the council's stance.
He said: "Sir Howard knows he has my full support on this issue.
"The stakes are high, but so are the rewards - £265m of private investment and 3,000 new jobs are worth fighting for."