The two have contacted rival Viacom -- home to MTV, UPN and Fox Family rival Nickelodeon -- which is expected to be interested in the business. USA Networks, home of the Sci-fi Channel, has also been approached but is believed to be fairly prudent with its cash when it comes to acquisitions and has said the price is too high.
The other buyers widely tipped to take part in any bidding are AOL Time Warner and Disney, although both have so far declined to comment.
News Corp first mulled the idea of selling in January when Fox Family co-owner and children's programming guru Haim Saban decided to exercise a clause in his contract to sell his half of the business back to News Corp.
Saban's decision came at a bad time for News Corp chairman Rupert Murdoch, who was beginning to prepare his bid for General Motors' satellite broadcaster DirecTV, which has a price tag of around $50bn (£35.3bn).
The two moguls have been unable to agree on a price for the business, which has 81m subscribers and owns the Fox Kids Network. Saban is said to have been angling for around $6bn (£4.2bn) for the business, including $2bn (£1.4bn) of debt and preferred stock. Murdoch thought the company's value was lower.
The network has failed to improve its fortunes since the partners acquired the Family Channel's parent company International Family Entertainment in 1997 for $1.7bn (£1.2bn) from Rev. Pat Robertson. As part of the deal, Murdoch agreed to continue running a religious show called 700 Club, which remains a clause if the network is sold.
Saban and News Corp formed the joint venture in 1996 after a successful alliance between the Fox Broadcasting Company and Saban to launch children's channels around the world in October 1995.