Alliance leader Naomi Long has said an "anomaly" in the counting of votes for Derry and Strabane council in last month's election prompted the party to launch a legal challenge.
She said one of the stages of the count in Waterside area, where the party lost a seat to the SDLP, had not been "properly completed".
Alliance has lodged an election petition with the High Court in Belfast which could result in a recount.
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The party lost both their councillors at Derry City and Strabane District Council in the local government election in May.
One of them was Phillip McKinney, who lost his seat in the Waterside to the SDLP's Martin Reilly by just 49 votes.
But questions have been raised over why Mr McKinney was eliminated when there appeared to be around 150 votes left to be transferred from two DUP candidates.
Mrs Long said the council and the Electoral Office had confirmed to the party there had been "an error".
She told BBC's Good Morning Ulster: "It was brought to our intention by a number of observers that one of the phases of the count in Waterside had not been properly completed.
"And when we looked at that and raised it both with the chief executive of the council and with the Electoral Office, they confirmed that there was indeed an error in the count, an anomaly in how the count had been conducted."
She added: "We don't know whether that changes the outcome but it does mean that the count was improper.
"The only way a recount can be done is to petition the court to reopen and recount the ballots and so the only people who can do that is the candidate or four electors from the DEA.
"And so that's what has happened, they have petitioned the court to reopen and recount the ballots.
"So it's now with the courts to decide whether or not that's the appropriate course of action, and if it is, there will be a full recount of that particular DEA."
It is unclear when a court hearing will take place for a judge to decide if there should be a recount.
The council said it is aware of a "discrepancy" in relation to the latter stages of the count in the Waterside area and has been liaising with the Electoral Office and relevant parties.
The Electoral Office has also been approached for comment.
Northern Ireland council elections use the Single Transferable Vote (STV) system, in which voters rank candidates in order of their preference.
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