Mayfair Bingo wants to set up shop on the site of an old gymnasium based on St Nicholas Road in Sutton town centre, website This Is Local London reports.
But the application has been opposed by Mecca Bingo, which runs a bingo hall in nearby Rosehill.
The argument will now be taken to court, as Mayfair seeks to overturn a decision not to have an online bingo gaming licence issued.
Chief executive of Mayfair, Simon Hannah, commented: "The only main objection has been from Mecca Bingo. They say they satisfy the bingo needs in the area but that is not true. They seem to think Sutton is part of Croydon.
"We are not claiming to offer anything different to Mecca, we are selling the same product. However, we are just trying to satisfy demand in small towns where the bigger companies don't go."
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