The company has begun a 30-day consultation period with the 60 staff who work for NI Free Newspapers, the subsidiary of News International that publishes thelondonpaper.
The paper will still be published throughout the consultation period.
James Murdoch, the chairman and chief executive, Europe and Asia, News Corporation, said: "The strategy at News International over the past 18 months has been to streamline our operations and focus investment on our core titles.
"The team at thelondonpaper has made great strides in a short space of time with innovative design and a fresh approach but the performance of the business in a difficult free evening newspaper sector has fallen short of expectations.
"We have taken a tough decision that reflects our priorities as a business."
News International began to review its efficiency and effectiveness in early 2008, which saw the company selling non-core operations such as News Magazines, PropertyFinder and CentreCore.
In the year to 29 June 2008, thelondonpaper recorded a pre-tax loss of £12.9 million on turnover of £14.1 million.