In a letter to the BBC, a group identifying itself as “concerned residents of Reading” said it worried about the impact on rehabilitation services for the town.
But the trust said more than 60% of its patients who live in Reading were already cared for at West Berkshire Community and Wokingham hospitals.
It said it would “launch a programme of engagement” in the coming weeks “to understand the potential impact of the proposed changes on our patients and their families”.
No redundancies are expected and the trust said it would “work with affected staff to identify suitable alternative roles and opportunities within the trust”.
But the group said the proposal had caused “enormous concern amongst patients, families, carers and staff”.
They said the impact of the proposal on staff “cannot be overstated”, with some “devastated”.
“Those of us who know Oakwood Unit understand that it is far more than a ward,” the said.
“It is a valued community resource that delivers personalised rehabilitation and support for some of the most vulnerable members of our society.”