Officers in all departments have been told to looks for savings in the next eight weeks before the council consults the public.
It is expecting the Government to demand it makes savings of at least 25 per cent in October as part of the coalition's comprehensive spending review.
But the authority, which employs 680 people, wants to identify savings now.
Council leader Roger Begy (Con) said: "We will be talking to the public and our staff about where to make cuts. I don't want staff at Rutland County Council worrying about losing their jobs.
"In the long run about 50 to 70 roles at the council may be lost due to these cuts, but we will not let anyone go unless we have to. We will most likely not replace people when they go."
He said the Government had already cut nearly £1m in capital from the council this year.
"We are always hearing that front-line services will be safe but no-one really knows what that means," he said. "The major cuts will come after the comprehensive spending review in October and the devil will be in the detail on how much and how quickly.
"I want to identify the places where we can make cuts now so that we can consult the public over them before the Government tells us where to make cuts instead."
The council has a budget of £31m for 2010/2011, with the money it spends coming from the Government and from council tax payments. Coun Begy is expecting the Government will want the council to spend at least £3m less.
He said: "We're looking at everything from how many senior people we have to the size of the cabinet.
"We are going to go right back to the start to look at what Rutland wants."
He said one area in which he did not wants the axe to fall was services for older people.
"We invest a lot of money into making sure people can stay independent in their own homes," he said.
He added that it was hard to say what will happen in education because the Department for Education was "making so many changes at the moment."
Coun Begy said council tax would not be affected.
He added: "The Government has already said councils will not be able to increase in council tax next year.
"They will talk to us later in the year about what will happen in 2012," he said.
Once the council has an idea of where cuts can be made in Rutland, it will consult the public to find out where residents believe money can be taken from.
Mr Begy said: "If we take action now we will be at the head of the game.
"We wish to remove concern by the community and our staff as quickly as possible."
Rutland County Council is responsible for providing education services, refuse collection, public transport, libraries and services for young and elderly people in the county.