An Islamic school which has applied for state funding is facing opposition from local headteachers and the National Union of Teachers.
The union says that if the application by the Leicester Islamic academy is successful, it will have a serious effect on surrounding schools, which will lose large numbers of pupils.
The pound;1,300-a-year academy, a combined primary and secondary, is applying to become a voluntary-aided school, funded by the Government. It is also bidding for state cash for new buildings with the aim of doubling its 400-pupil roll.
Peter Flack, Leicester NUT spokesman, said: "If the academy is expanded, schools which at present have a high Muslim population will lose pupils and therefore have budgets affected.
"Secondary education in the city needs stability. We already have several schools with a majority of Muslim pupils that are performing well. The interests of the whole city need to be looked at. We are also opposing plans to create two other new schools in Leicester because there is just no surplus of secondary places in the city."
Of the pupils attending Moat community college, 85 per cent are Muslim. Principal Freda Hussein said: "Other schools in the city have had to close in the past because there were more places than children. This is still the case.
"If we create another school, we have to make sure that it doesn't mean the closure of other schools. My argument is not a faith one, it is one of numbers. This will affect jobs and budgets of schools across the city if it goes ahead," she said.
Dr Mohamed Mukadam, the academy's principal, said: "I am absolutely convinced that other schools will not lose out.
"We have proof that lots of students are being sent not only to Islamic boarding schools elsewhere, but even abroad to India or Pakistan to be educated. There is no proper provision in Leicester for these young people. We want to attract them back."
The academy's application is waiting to be considered by Leicester council. It states that up to 25 per cent of pupils would be non-Muslim, although the school would have an Islamic ethos. Boys and girls would be taught in different classes, with girls required to wear a headscarf.
A recent Office for Standards in Education inspection found that GCSE standards at the school were well above the national average.
But it concluded that the quality of teaching and pupil achievement in the lower school were unsatisfactory.