The Otago Rugby Union board has delayed filing for liquidation by a week as it attempts to piece together a financial rescue package.
New Zealand Rugby Union says that while the application was due to be filed on Friday, the Otago board agreed to defer it.
The NZRU, Dunedin City Council, Dunedin Venues Management and the Rugby Players Association have all been working through details of a possible rescue package.
Otago Rugby Union owes $1.2 million to the Bank of New Zealand and $750,000 to tradesmen.
This week it posted its sixth consecutive loss of $862,000.
NZRU chief executive Steve Tew says potential sponsors have been consulted, but nothing was put together in time for Friday's deadline.
If a rescue package can not be put together, there is the possibility the Otago union will not field a team in the domestic rugby competition.
Otago Rugby Union was founded 131 years ago.
High-profile players are proposing a national fundraising match.
Radio New Zealand News understands All Blacks captain Ritchie McCaw is leading a delegation offering a significant North-South rugby match to raise money.
The group met Dunedin City Council on Thursday, but no final decisions have been made.