The old Noble's Hospital may become a new school.
Ballacloan Infants' and Fairfield Junior School will merge by April next year.
It will mean a new facility is needed to house the extra pupils.
Director of Education Martin Barrow has earmarked the site on Westmoreland Road to be the location.
Maritime operation will 'map, exploit and dismantle' illicit networks
Operation Emstara took place in Irish Sea
Witness appeal after man is assaulted in Douglas
Police believe incident was filmed
Next chief minister faces 'very difficult decision' on Alfred Cannan
Alex Allinson says the current chief minister could have a big impact on the next Council of Ministers
Manxman repairs expected to exceed £2.5m
The Steam Packet's flagship has been out of action since July