Oxfordshire's only Islamic school could close when its lease runs out at the end of this year.

Iqra Girls School in Littlemore rents the Lawn Upton building from the Diocese of Oxford - but by January, it might be homeless.

Because the building is run through a trust, the Diocese is bound by law to make as much money as it can - and that means selling it for £2m.

Hojjat Ramzy, chairman of the Iqra trustees, said: "I want to save this school for the sake of the children. I would do anything to save it.

"The building costs £2m - we can't go anywhere else but we can't raise that amount of money either."

If the school cannot raise the funds, Iqra would be forced to relocate for the third time in as many years.

In 2003, it opened at Oxford Community School in Glanville Road, East Oxford, but after a year, it moved to Azad Islamic University in Farmoor.

This proved too far for parents to travel - with pupils arriving late for lessons - so the school moved to Lawn Upton in January 2005.

The lease was a temporary arrangement as the John Henry Newman School - on the same site - did not need to use the building.

Spokesman for the Diocese Sarah Meyrick said: "The site is owned by the Lawn Upton Trust so we are bound by the Charities Act to maximise the financial gain. Mr Ramzy is welcome to put in an offer.

"It's been a very friendly, supportive relationship and we are sympathetic - but our hands are tied."

When Iqra opened in 2003, there were just five year seven girls. Now there are 80 girls, aged between 10 and 15.

The school tried to get state funding from Oxfordshire County Council last year, but was told by council leader Keith Mitchell that to be considered as a state-funded Muslim secondary school, it needed at least 1,500 pupils.

Even with positive Ofsted inspection reports, that number of students could not be recruited overnight.

Mr Mitchell, who is meeting Mr Ramzy in the next few weeks, said: "It's an exploratory talk to see what they want and what we can do - if they want to build up their numbers or whether they want to come into the state system."

He added: "I am in listening mode. If we can help, we will."

Oxford East MP Andrew Smith went to the school recently to talk to the pupils about his political career. He also met staff to hear about their uncertain futures.

He said: "It's clear from the briefing they gave me that the school is in a desperate position in relation to its accommodation.

"Like any other private school, their trustees are responsible for securing premises, but I have written to both the Oxford Diocese and the county council to see if they can do anything to help - for example, by extending the rental period on the existing building."