Dragons boss Dean Ryan insists a reduction in the number of regions from four to three would be a damaging step for Welsh rugby to take.
The Dragons could be at risk if one of the professional sides are disbanded ahead of the 2023-24 season, which is among several proposals included in a report commissioned by the Professional Rugby Board (PRB) to look at how best to move the game forward.
Also reportedly being suggested is a merger between the Scarlets and the Ospreys, although the Swansea-based team have made it clear in a statement they would oppose this.
The Dragons are second from bottom in the United Rugby Championship table, but Ryan insists their demise would have lasting repercussions.
"If you look at a financial sheet it might look better with three, but I don't believe that would benefit the long-term future of rugby in Wales," Ryan said.
"It is already facing challenges of how to develop players through to the competitive end of the game.
"If you look at successful tier-one and World Cup-winning sides, keeping the avenues open for a range of player development for people to experience is invaluable.
"Everyone talks about models, but the challenges Italy and Scotland face aren't solved by restricted numbers.
"Statistically, World Cup-winning sides have a number of sides competing at the top level and a number of avenues for players coming through."
The Ospreys have won the URC four times under its various guises, second only to Leinster, and are intent of keeping their independence.
"Ospreys have been working closely and collaboratively as a member of the PRB to devise a strategy that will ensure sustainability and raise performance across the professional game in Wales," an Ospreys statement read.
"As part of this process the PRB has commissioned research from a number of sources, including Oakwell, to ensure the strategy is informed by deep and independent insight. This research will inform, but not dictate, the strategy.
"We remain bullish about the future of rugby in Wales and look forward to further success and Ospreys remaining the most successful Welsh region."
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