Campaigners plan to occupy the Assembly government's stand at the event at Ysgol Brynhyfryd, Ruthin, which starts on Monday, to force a debate on the issue.
They will demand a multi-campus, Welsh-medium higher education college as part of an integrated system, which would include the preservation of village schools and compulsory Welsh at FE colleges.
Cymdeithas education spokesman Ffred Ffrancis said: "An ability to conduct all work in the medium of Welsh is as essential in FE as being literate in English and IT skills.
"It is vital that people trained in FE in administration work, social care, baking, travel and tourism or whatever are able to do that in Welsh so that they can be part of a fully bilingual Wales."
The current education system is equipping students only as potential teachers and translators, rather than offering all-round skills, he added.
The demonstration is planned for the last Saturday of the Urdd. Mr Ffrancis said Cymdeithas would demand a meeting with Jane Davidson, minister for education, lifelong learning and skills. But a spokesperson for Ms Davidson said she had not been approached by the group.
The Assembly government wants to increase the proportion of higher education students studying at least in part in Welsh from 3.4 per cent five years ago to 7 per cent by 201011, and has pledged an extra pound;4 million to help. In FE, only 2 per cent of courses are at least partly in Welsh.
An Assembly government spokeswoman said the results of an appraisal of Welsh medium provision would be available in the autumn.
"We are committed to supporting the Welsh language as an integral part of our national identity. The education system has a significant part to play in this from early years to higher education - and action is being taken at all levels," she said.
Among the highlights of this year's Urdd Eisteddfod - the largest youth festival in Europe - will be a visit from leading US author Anthony Horowitz. He will be launching the Welsh translation of his bestselling children's book Stormbreaker, about teen-agent Alex Rider.
The festival also features singing master classes by opera star Rhys Meirion, who will be the Urdd's day president on Friday. Monday's day president is Footballers' Wives actress Tara Bethan, who played temptress Kelly in the sex and soccer series.
* The Welsh Language Board says its proposed merger with the Assembly government could weaken the language. In its response to consultations on the move, the board also says the Dyfarnydd, the new independent regulator, should be responsible for agreeing and monitoring public bodies'
Welsh-language schemes. It also fears a more complicated regulatory structure will duplicate resources.