Plan to house students at County Hall in Taunton
Part of County Hall in Somerset may be sold or leased as accommodation for students, the council has said.
The local authority is in early talks with Somerset College over the use of its seven-storey block in Taunton.
Cabinet member David Huxtable said: "We are looking at all of our properties to identify where we can make savings or generate income."
County Hall will be reorganised so its 2,500 staff will use two of its three office blocks, leaving one free.
"The council will be a smaller organisation by 2013 and we need to make more efficient use of our office space so that we continue to deliver good value for money for local residents," added Mr Huxtable.
Somerset College's main campus is on Wellington Road which less than a mile from the council offices.
Principal of Somerset College Rachel Davis said: "We are already a major provider of university courses in Somerset, and as a result of higher education changes we expect student numbers to grow.
"Having university students studying and living in central Taunton would be a major boost for the town and the county.
"The County Hall option is one of a number of options open to the college."
Currently, the college offers 150 rooms for students at its Halls of Residence in Canonsgrove in Staplehay, Taunton.
The outcome of the plan will be known later in the year, as it will depend on the potential providers of the student accommodation contract and the college itself.