A public meeting of Haringey councillors will take place in February to decide on the future governance of the Alexandra Park and Palace charitable trust.
The north London council, which has been the sole trustee of the palace since 1980 and has come under fire from some local residents over its management of the charity, met local representatives in October to ask their opinions on how to run the trust.
Most respondents said they favoured replacing the existing board of councillors with independent trustees, a spokeswoman for the charity said, and that option was one being considered by the sitting trustees.
Jacob O'Callaghan, a local resident and a member of the Save Ally Pally campaign, said radical changes were needed.
"At the moment, there's no charitable activity going on," he said. "It's called the people's palace, but the people can't even get in."