The DSC, which has run www.governmentfunding.org.uk since 2003, will not bid for the contract as a matter of principle and plans to continue its service, potentially in competition with a new site run under government contract. If the DSC fails to get new funding, it might start to charge users for the service.
"We have said we don't think that commissioning is the best way to engage with the third sector, so to accept a contract would be hypocritical," said Ben Wittenberg, director of policy and research at the training and publishing charity.
"The better way of ensuring the needs of the sector are met is through an open grants process rather than the OTS deciding what to do themselves and contracting out a service."
The Government's third sector review last year found that the site was "not comprehensive, even of central government grants", because only eight departments were represented. It put forward plans for covering all departments.
Wittenberg said the DSC would monitor the OTS-contracted service to make sure it was significantly different, including information on contracts as well as grants, for example, and details of local authority funding.
"If they commission something that looks just like what they grant-funded from us, that would seem like a waste of time, effort and money," he said. "In that case, there is every possibility that we will be jumping up and down and stamping our feet.
"If they think there is a need for the service and the voluntary sector should be involved, then it should be run as a grants programme."
The DCS's grant, worth just under £260,000 in 2007/08, will be withdrawn at the end of this year in time for a new service to begin in 2009/10.
An Office of the Third Sector spokesman said it had liaised with the DSC: "Government must ensure good value and accountability for the taxpayer."