Fife is facing the loss of 450 jobs from Rosyth unless a Ministry of Defence contract is awarded to Babcock.
The MoD is set to award a contract for the Type 31e frigate (T31e), with Babcock among the three contenders, along with BAE Systems and Atlas Elektronik.
The MoD has remained tight-lipped on a timeframe for the contract, saying only that it will be awarded before December this year.
Babcock has already asked for voluntary redundancies, and it is understood that they are looking for 150 workers to go.
It follows the near-completion of the supercarrier HMS Prince of Wales, which is being assembled at Rosyth.
The carrier, along with the HMS Queen Elizabeth, has provided work at the yard for a number of years.
However, union Unite said that Fife could face a further 450 job losses if the frigate contract were to be awarded elsewhere.
Unite said: “The company are extremely optimistic they can work with the recognised trade unions (Unite, Prospect & GMB) when they secure the T31e project to minimise the risk of potential future compulsory redundancies.
“To achieve this, in the meantime, the company shall look to release volunteers for redundancy under the current phase announced in February 2019.
“However, whilst securing the T31e project will give the yard a future longer term there is still the matter of current surplus labour.
“It is for this reason the company and the recognised trade unions shall look to enter into a temporary mobility agreement to secure the skillsets required for the future.
“In the unfortunate event the company is unsuccessful in securing the T31e project it is likely we would be faced with the potential of 450 trade union members being made compulsory redundant, impacting all skillsets and all trade union collectives.”
Babcock, BAE, and Atlas Elektronik were each awarded £5m from the MoD to develop their concepts, in what is known as the Competitive Design Phase.
The winner of this phase will then go on to manufacture their design.
An MOD spokesperson said: “The Competitive Design Phase is proceeding to schedule.
“The outcome of the competition for the design and manufacture of the ships will be announced by December 2019.”
The frigate contract is understood to be worth £1.25bn.
Babcock’s Arrowhead 140 is thought to be based on a design used by the Danish navy’s Iver Huitfeldt-class frigates.
The MoD hopes to have the first of eight ships delivered by 2023.
Meanwhile the HMS Prince of Wales is set to leave Rosyth and head up the Forth in mid-September.
The second of two Queen Elizabeth-class carriers, it follows the HMS Queen Elizabeth which left the Fife yard in June 2017.
The 65,000-tonne ship returned in April this year for scheduled maintenance, just narrowly squeezing under the Forth Bridge.