Adoption agencies could be forced to close.
Roman Catholic adoption agencies are seeking a legal lifeline that will allow them to continue to operate under the Sexual Orientation Regulations.
The agencies have a policy of only placing children with married couples. The Regulations make it unlawful to discriminate on grounds of sexual orientation when providing a service.
Twelve Roman Catholic agencies will apply jointly for a Government grant of £250,000 to investigate ways of surviving under the legislation.
The grant, which will pay for legal advice, was recommended by a committee set up by the Government to investigate the agencies' concerns.
Jim Richards, chief executive of the Catholic Children's Society, said: "This grant the Government is making available, will enable us to examine every legal option. No one should believe the SOR legislation is a fait accomplait."