It is believed the Tourist Board's budget for supporting events could be cut by more than 50% next year.
Events such as the North West 200 and the Belfast Festival at Queens attract grants from the public purse.
The aid was administered by the NI Events Company at the Department of Culture, Arts and Leisure but is now the Tourist Board's responsibility.
By the end of this year, events across Northern Ireland will have received Â£1.6m in grant funding.
According to the Tourist Board, however, the amount it will have available for grants next year will fall to Â£700,000 - a cut of 56%.
The Tourist Board would like more but will have to await the outcome of the spending review.
The cut has prompted fears among some that grant-aiding cultural and sporting events will no longer be seen as a priority as public spending cuts begin to take hold.
Some Stormont Executive funding for major sporting and cultural events is to be dramatically reduced.