The Griffith University Art Museum (GUAM) in Brisbane's South Bank hosts visiting exhibitions and is separate to other campus galleries dedicated to showing student work.
Whether jobs will go as part of the proposed changes is still to be determined as part of a staff consultation process to be completed by next Friday.
The gallery has six staff as well as casual workers and volunteers.
Prominent Queensland artists including Victoria Reichelt and Tony Albert have gone online to voice their opposition to the closure.
The Griffith University Art Museum could be used by students from its expanding film school. (HANDOUT/GRIFFITH UNIVERSITY)
The museum is an amazing cultural asset, Reichelt said, and its loss would diminish the university's reputation and reverberate for years as an "extremely myopic decision" she posted on Instagram.
"This is completely unacceptable," replied artist Tony Albert.
The proposal has not been finalised and the university genuinely wants to hear what people think, Pro Vice Chancellor and head of South Bank campus Scott Harrison told AAP.
"I'm very sad about this and it's not a decision that the university makes lightly ... it's awful to have to be considering this."
Affected staff are taking part in a confidential process with the university, Professor Harrison said, and would not give any further details about potential job losses.
"That's one of the things that's being considered, it's not something we like doing," he said.
The gallery space would be used by the film school, which has doubled in size over the past decade, and has to leave its leased studios in West End by mid-2024.
The proposal would not affect teaching or learning at the Queensland College of Art or the film school, Prof Harrison promised in an email to staff.
"There is no other suitable space at Griffith for GUAM and taking space elsewhere would present an unfeasibly high economic cost to Griffith, particularly during the tough economic times the university is facing," he said in the email.
The museum is the custodian of a significant public art collection which is displayed across the university's campuses and which will also be on show at a new CBD campus to open in 2026.
The university was committed to maintaining the collection even if the art museum closed, Prof Harrison said.
The museum is  showing photography by Chinese artists Pixy Liao and Lin Zhipeng in an exhibition titled Each, Other.
"If GUAM does close, we will work with any artists who have been booked for exhibitions next year to ensure they receive as much notice as possible of the changes and appropriate action taken with respect to their contracts," the university said.
The closure of GUAM would be a substantial blow not only to the art school but Queensland's arts ecosystem, according to the National Association of Visual Arts.
"The museum serves as a crucial training ground for arts professionals, curators, and artists in Brisbane," NAVA executive director Penelope Benton said.
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