The Australian National University's honorary committee is considering the honorary doctorate of law given to Sheikh Hasina in 1999 but has stopped short of committing to any decision before a larger review of its processes is complete.
The confirmation came days after an arrest warrant was issued following allegations of abusing political power by Bangladesh's anti-corruption commission.
Bangladesh's International Criminal Tribunal also issued an arrest warrant for Ms Hasina in October 2024 for alleged crimes against humanity after she fled to India months earlier following her ousting amid mass protests.
She faces charges of genocide and murder, among others, allegations that she denies.
More than 1000 people were killed during a crackdown on student-led protests against the prime minister, according to the interim Bangladeshi government's health minister in August.
Human Rights Watch accused the military under Ms Hasina of being ordered to shoot on sight to enforce curfew orders.
It called for international governments to demand the end to excessive force and hold troops accountable for human rights abuses, including attacking unarmed student protesters.
Human Rights Watch deputy Asia director Meenakshu Ganguly called for "influential governments to press Sheikh Hasina to stop her forces from brutalising students and other protesters" at the time.
It would be a historic move for ANU to strip the title.
"Revocation of such a degree has not occurred in the university's recent history and no procedural precedent exists," a spokesperson told AAP.
"The university is undertaking to develop a more detailed revocation procedure before deciding on any specific matter."
Bangladesh police requested an Interpol red notice be issued against Ms Hasina, local media reported.
A red notice is a worldwide request to law enforcement to help locate and provisionally arrest a person pending extradition or legal action.
Ms Hasina is reportedly hiding in India.
