Southern F Locomotive Trust is holding a public meeting on Monday to discuss the possibility of tendering for the category 1-protected train.
Spokesman Karl Barkley said the trust wanted to get support from the community.
"We are trying to get enough interest from the community in getting the train into the hands of a charitable trust instead of being at the whim of financial institutions," he said.
The train ceased operations this year and its owner, Kingston Acquisitions Ltd (KAL), was placed into receivership early last month by Prudential Mortgage Nominees.
The receivers put the historic steam train up for sale by international tender.
Mr Barkley said he did not want to see the train "disappear" or be bought by overseas investors.
He had approached funders in the Southland region to back the trust's tender.
He said the trust could decide to operate the train itself or lease it to Kingston Flyer Steamtrain Ltd, who previously held the lease with KAL.
He would like to see it running before the end of the summer, he said.
The trust would base itself on the Taieri Gorge Railway, which was started by the Otago Excursion Train Trust.
Mr Barkley said he would be meeting Kingston Community Association chairman Peter Gibson who had expressed interest in setting up a trust to buy the train.
He previously told the Otago Daily Times a trust was an option worth exploring if the receivers failed to sell the train.
Southern F Locomotive Trust was set up two years ago with the aim of buying a steam train to run between Invercargill and Bluff as a tourist attraction.
The Kingston Flyer tender sale includes two steam locomotives towing seven fully refurbished carriages, track, station, associated buildings and nearly 80ha of development land around Kingston, 35km south of Queenstown.
The 80ha of development land for tender is made up of 13 parcels of land, including residential sections and development blocks, one of which has consent for a 15-lot subdivision.
Bayleys Queenstown sales consultant Barry Robertson said he had sent out tender documents to 30 interested parties.
Michigan-based Railmark president and chief executive Allen Brown said late last month he would be putting in an offer.
Tenders close on December 11.
