A feasibility study by Oxford Brookes has sparked fears that the university wants to build on woodland overlooking the city on Headington Hill.
Residents became alarmed when surveyors were seen working at the site, which includes one of the last broad leaf woods on a hill with views of the dreaming spires.
The university this week confirmed it was investigating whether land near Morrell Hall student accommodation, close to Headington Hill Hall, was suitable for development. But it said the woodland was not at risk.
University spokesman Rebecca Baxter said: "Oxford Brookes asked surveyors to carry out a survey to measure land levels at various points across this site.
"This work is part of a feasibility study to look at improved use of the area, which could involve new building on the hall site, or demolition of some buildings.
"Any work of this kind would require the university to demonstrate that any new buildings would not adversely affect views from Oxford towards Headington."
Chris Glover, a resident of Feilden Grove, said: "If the university's intention is to leave the wood alone, why are they having to carry out survey work there?
"Until the 1980s the wood was larger, but Oxford Brookes has encroached on it to provide car parking, accommodation and a nursery. I remain suspicious that this little haven is under threat once more.
"Recently, numbered pegs and blue spray markings have sprouted throughout the entire wood, including the area not owned by the university and designated as a nature conservation area in the Oxford Local Plan."
Morrell Hall is a collection of buildings used for student accommodation built in the 1970s close to the bottom of John Garne Way.
It is a short distance from the more celebrated Headington Hill Hall, which was built for the Morrell family.
For many years it was home to the disgraced tycoon and publisher Robert Maxwell. The house, and the former Pergamon Press buildings, are now also used by the university.
Marilyn Cox, secretary of the Jack Straw Residents' Association, said: "Any development in this whole area worries us all. It has already reached saturation point.
"There is a widespread feeling that Brookes likes to play its cards close to its chest."
Earlier this year residents presented a petition to Oxford City Council urging councillors to turn down schemes proposed by Oxford's universities, hospitals or schools.
The petition from the Central North Headington Residents' Association called for a moratorium on any further developments applied for by major institutions that would "put additional pressure on parking, roads and transport".
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