Hillingdon LBC is considering legal action against the Government after the Home Office refused to provide it with extra funding to house asylum seekers.
The local authority has the highest concentration of asylum seekers in the country, with more than 3,000 supported by the Home Office in six hotels around Heathrow Airport.
Once cases are decided, asylum seekers are evicted and become the host council's responsibility.
The Home Office has refused a request from the council for extra support to cover the estimated £5m shortfall resulting from the extra demand on services.
A council spokesperson said leader Ian Edwards was exploring the possibility of a legal challenge against the Government.
The spokesperson said: ‘The situation is unfair, unacceptable and is, in effect, saying that Hillingdon taxpayers should shoulder the burden of what is a national issue. This should be funded centrally rather than passing the buck and expecting our residents to foot the bill, putting intolerable pressure on the council's finances.'
A Home Office spokesperson said: ‘We remain committed to working closely with local authorities to work towards a fair and equitable spread of accommodation, and provide the financial support required.'
