Staff at BBC Wales have been told there will be up to 155 redundancies over the next five years as part of a wider reorganisation of the corporation.
The corporation is looking at proposals for a new production HQ
The cuts are part of 2,500 post closures across the whole BBC to deal with a £2bn budget shortfall.
But BBC Wales controller Menna Richards also announced new investment in local services and other programmes, although fewer hours of television are proposed.
Trades unions said they were shocked by the news.
Ms Richards told staff: "Some difficult decisions will have to be made".
BBC Wales currently employs 1,289, and staff were not given details of where posts were to be lost in the announcement.
Ms Richards said posts had to be reduced to meet the challenges of growing digital, on-demand markets.
But she said the savings would be offset by new investment in content, including local services and other programmes, and redeployment and retraining would lower the total number of redundancies over the next five years.
Ms Richards told staff in Cardiff and Bangor: "The next five years is going to be a real test of our creative abilities. But the ambition is simple: our audiences must regard us an indispensable part of their lives.
"Yes, it means making some tough choices - about what we make and how we make it.
"But it's also a journey we should approach with confidence because our track record in making great programmes that audiences love is outstanding."
Ms Richards also announced that BBC 2W will end in the run-up to digital channel switchover in 2009 and BBC Two Wales will be carried across all digital platforms from that point.
She said there was also an opportunity to build on BBC Wales's recent success through network commissions, as part of the corporation's commitment to increase production from outside London.
She said BBC Wales was working on proposals for a new production headquarters to replace the existing one in Llandaff, Cardiff.
"Our ambition is to move to a new building that will have the technology and resources to help us make more world-class content across all platforms," Ms Richards added.
The cuts at BBC Wales are part of a six-year plan, called Delivering Creative Future, which was prompted by a smaller than expected licence fee settlement from the government.
Meic Birtwistle of the NUJ said: "There's no way that we could swallow anything on that sort of scale. One's got to remember the BBC in Wales has just lost over 200 jobs over the last few years".
Unions said they would write to the BBC asking for meaningful negotiations on the cuts, and asking for the redundancy process to be halted immediately.
Gerry Morrissey, general secretary of Bectu, said he was "very confident" his members would support industrial action.
Welsh Secretary Peter Hain said Ms Richards assured him that BBC Wales "is in a strong position to use its resources and people more effectively to build on the network successes it has already achieved.
"The fantastic success of networked drama programmes such as Doctor Who and Torchwood has given the BBC in Wales a reputation for excellence and placed it in a strong position to reap benefits from the transfer of more drama and factual programme production out of London," said Mr Hain.
Heritage Minister Rhodri Glyn Thomas said: "While I can't comment on management decisions, I have worries about public services broadcasting in Wales if these cuts are fully carried out.
"I'm particularly concerned about the effect this could have on public debate in Wales which is essential for a healthy democracy. "
Conservative shadow Welsh secretary Cheryl Gillan said: "I am concerned at the nature of these job cuts and the impact they will have on both staff and the quality of programmes.
"Having spoken to BBC management today I am also seeking assurances that these proposals will not lead to a reduction in programmes produced in Wales.
"It saddens me to hear of these planned redundancies. However with the plan to move more network production out of London I will be encouraging the BBC to use BBC Wales."