The Museum of Cardiff will remain in its current location for the next five years although concerns have been raised about its long-term future.
The museum had been at risk of closing as a physical space and being turned into a mobile attraction when the Royal Welsh College of Music and Drama (RWCMD) moved into the Old Library building last year.
But following a lease agreement between Cardiff Council and the RWCMD, the museum will continue to operate in the building.
It is hoped the agreement will give sufficient time and stability for the museum, stakeholders and the council to fully examine options and undertake feasibility assessments for any future move.
The Museums Association welcomed the news but said "significant concerns" remain about the museum’s long-term future.
Joshua Robertson, Policy Officer for the Museums Association, said: “We welcome the temporary stay-of-execution and the short-term stability that this provides [...] The Museum of Cardiff is a thriving cultural asset, which has a strong track record of community participation and engagement and is vital to the cultural life of the city.
“However, we have significant concerns surrounding the future of the museum as a permanent venue is yet to be found. We will continue to work with our external partners across Wales and beyond to advocate for a permanent venue for the museum, and a long-term funding strategy to ensure future success for the Museum of Cardiff.”