Rural primary schools could be closed and merged in plans aimed at targeting falling pupil numbers.
North Yorkshire County Council said the Upper Wharfedale area included seven primary schools which between them serve no more than 347 children.
It said that figure was projected to fall to 303 by 2014.
The council is consulting parents on two proposals, both of which would lead to the closure of Arncliffe and Kettlewell schools.
A council spokesman said: "A growing number of governors and head teachers have been concerned to pre-empt the financial difficulties which are expected to affect many schools locally."
He said letters with details of the council's two proposals had been sent to parents, school staff and governors.
The first option proposes a single school, created from Arncliffe, Kettlewell and Grassington schools, on the Grassington site.
The second option would involve the creation of one school for the area currently served by Arncliffe, Kettlewell, Grassington and Threshfield which would be based on two sites.
The Grassington site would cater for children aged four to seven while the Threshfield site would teach children aged seven to 11.
Councillor John Watson, executive member for schools, said: "It is hard to see how, with low and declining numbers, and so declining levels of funding, schools in this area can continue to give children the best possible education and range of experiences."
Responses from the first stage of the public consultation will go before the county council's executive board in January, before a final decision is made in March.