Rupert Murdoch's £11.7 billion bid to take full control of Sky through 21st Century Fox is "not in the public interest", the competition watchdog has said.
The Competition and Markets Authority said the judgement was provisional and on the grounds of media plurality.
"It would result in the Murdoch family having too much control over news providers in the UK, and too much influence over public opinion and the political agenda," it said.
The CMA suggested three ways its concerns could be addressed:
blocking the deal
spinning off Sky News
"behavioural" changes to protect Sky News from direct influence from the Murdoch Family Trust.
Fox said it was "disappointed" but will continue to engage with the CMA before the final report is published on May 1.
The US firm said it still expects the regulator to approve the deal by June 30.
The CMA added its provisional decision was not due to "a lack of genuine commitment to meeting broadcasting standards in the UK".
Deputy Labour leader Tom Watson, a prominent opponent of the Fox bid, welcomed the CMA's findings.
Ofcom also said the "in-depth, second-stage review" by the CMA has "provisionally reached the same conclusions as Ofcom's advice".
Sky said it "noted" the CMA's initial findings.
The CMA review came as Sky is set for a new owner, after Walt Disney agreed a £39 billion deal to buy Fox's entertainment assets.
The 21st Century Fox bid was referred to the competition watchdog for an in-depth probe by Culture Secretary Karen Bradley in September.
Mr Murdoch's company is attempting to acquire the 61% of Sky it does not already own.
The CMA was asked to examine claims of misconduct at Fox, which have ranged from alleged racial and sexual harassment to making up quotes.
Mr Murdoch's latest approach comes after his last attempt at taking over the business through News Corporation in 2011.
That bid was scuppered by acute pressure on the company, brought about by the phone-hacking scandal, amid notable political and public opposition.