Examination board Edexcel is considering applying for degree-awarding powers.
A spokesman for the exam board confirmed it was exploring the potential for providing FE colleges with degree certification, describing the step as a natural progression from its provision of Higher National Diplomas.
The move is in line with universities minister David Willetts' desire to expand the range of higher education providers, and follows last week's news that a school in Norfolk is bidding to become the first state secondary to offer University of London degrees.
Edexcel is to discuss its plans with college principals at the Association of Colleges (AoC) conference in Birmingham later this month.
Martin Doel, the association's chief executive, described the move as "a logical step".
Colleges fear that, in tough financial times and while subject to a cap on student numbers, many more universities will follow the lead of De Montfort University and withdraw their validation of degrees delivered within FE institutions.
Mr Doel said universities and colleges were stuck in "a feudal relationship" where "the squire decides what the serfs can teach".
"We need a peasants' revolt where they realise what they do is exceptionally important," he said. "They need an opportunity to promote what they do most effectively."
The introduction of a new player, he argued, would enable colleges to find a degree-awarding partner best suited to them.
The association is also talking to private provider BPP, which was granted university college status earlier this year, about the role it may play in validating degrees.
"The opportunity for colleges to be free to seek the best partners in higher education is important, as is being masters of their own destiny," Mr Doel said.
However, he warned against Edexcel gaining a stranglehold on the FE sector. "My concern is that they have a near-monopolistic supply in relation to some qualifications, which I think is anti-competitive and is leading to some cost growth," he said. "I'd hate for colleges to exchange one master for another."
John Widdowson, principal of New College Durham, said colleges would welcome the opportunity to deliver degrees with a familiar organisation. "We can see that logic of progression routes right up to into higher education," he said. "It makes a lot of sense."
New College Durham is expecting to receive its own degree-awarding powers early next year.
Mr Widdowson said colleges that achieve those powers would be able to undercut universities following the impending rise in the cap on tuition fees.
"It is widely accepted that colleges have a low cost base," he said. "By focusing on teaching and learning we can provide better value for students."
The AoC estimates that colleges could charge as little as pound;5,000 a year in tuition fees.
"This seems likely to be less than universities, and also comes with the benefit of students generally living at home," Mr Doel said. "If you are a student you are looking at considerably less debt and a qualification that is more employer-facing, and leads direct to a job."
This story first appeared in Times Higher Education yesterday.