The Minister for Arts, Sport and Tourism, Mr O'Donoghue, has been urged to intervene in a row that threatens the future of the Hawk's Well Theatre in Sligo.
He has received a letter from 14 local production groups warning of a "real and immediate" crisis at the theatre.
The Minister was told that professional and amateur drama groups, as well as other entertainers, fear the theatre could be shut down within weeks.
It has hosted performances as diverse as The Abbey Theatre's Playboy of The Western World and concerts by members of Westlife when they were still called I O You. Copies of the letter were also sent to TDs, local politicians, tourism leaders and Arts Council chairperson Ms Olive Braiden.
The row centres on the Arts Council's refusal to provide funding until the Hawk's Well board is disbanded and a new company formed to run the theatre, a main recommendation of a specially- commissioned review. Some directors have resigned. Others, including Sligo Mayor Mr Declan Bree, have not.
The Arts Council's refusal, so far, to provide funding for 2005 follows its decision to cut last year's allocation by almost half to €150,000.
In a series of developments as dramatic as anything staged at the theatre, Mayor Bree portrayed the Arts Council as the villains of the plot.
He accused the council of withholding funds in a bid to force the resignation of the board. He said the council is also pressuring the theatre to reduce its commitment to amateur productions.
He agreed more professional productions were necessary to provide balance in the programme of events, but argued that, without funding, the theatre couldn't afford to book the professionals. "It's as if people in Sligo and the west don't matter."
But the amateur companies in the area who wrote to the Minister reckon the mayor is the villain. They are furious with him. They said they believed it was the failure of the remaining board members to resign which was holding up funding, as well as implementation of other recommendations in the review.
They called on the remaining directors to resign, and questioned whether those still there legally constituted a board at all. Theatre staff said they fear the crisis will force the loss of their jobs.
The five full-time and 17 part-time employees issued a public statement calling on the board to resign so the Arts Council will provide funds and the jobs can be saved.