Edinburgh Zoo officials have sent out a warning letter to their members telling them of their fears for the future of the popular city attraction.
An artist's impression of the new Edinburgh Zoo chimp enclosure
The zoo wants to sell greenbelt land off Kaimes Road to housebuilders to help fund a £72m revamp of the site.
But the planning committee of the SNP/Lib Dem-led council has overturned the old council's support for the plan.
The council intends to side with local protesters at a public inquiry which will consider the issue next year.
The zoo has grown to become the second most popular paid tourist attraction in Scotland, with more than 650,000 visitors a year.
However, the council has received about 200 objections from the public against the plans because greenbelt would be lost.
Kerry Mackay, The Royal Zoological Society of Scotland's senior co-ordinator of the membership and animal adoption development department, wrote in a letter to members, about how disappointed they were with the Edinburgh Council planning committee's decision on 4 October.
She said: "The sale of the land to the west of the zoo was going to be an essential source of income for the 20-year masterplan and without it the future of the zoo is in serious jeopardy.
"A feasibility study revealed that the land to the west of the Zoo was surplus to the animal needs of the proposed new collection.
"Use of the area is compromised by the steep gradient and the requirements of the Disability Discrimination Act (1995) relating to accessibility.
"Any profit made from housing developments would be channelled back into the zoo to help it realise its aim of becoming a world class visitor attraction with the potential to bring in an estimated £1bn to the economy of Edinburgh and Lothian over the next 20 years."
Iain Valentine, Edinburgh Zoo's head of animals, education and conservation, said: "This decision regretfully could have a serious effect on the future of Edinburgh Zoo and there is a possibility that the zoo would no longer be able to operate in its current capacity."
Jenny Dawe, Edinburgh Council leader, said: "I can fully understand the zoo's concerns because they have very ambitious plans for developing the zoo to make it into a really modern facility, so I can understand their disappointment.
"However, against that there is the loss of greenbelt land, which has concerned local residents, which led to about 200 objections to the change to city local plan and eventually led to the planning committee deciding that piece of land would not be rezoned for housing."