Ali Stevens, headteacher of Pontllanfraith comprehensive in Caerphilly, admitted parents were applying for secondaries outside the school's catchment area, but said: "Many are delighted with the service we provide."
According to the local authority, 82 fewer pupils are expected at the school this September. That means less funding for the next school year as parents fear sending children to a "failing school".
Ms Stevens said she felt positive about the next Estyn review, due at the end of the summer. In 2006, inspectors criticised achievement, the quality of education, and leadership and management.