Black Country Living Museum has received £30m to create new attractions that "whisk people back in time".
The project, titled Forging Ahead, is the museum's largest ever, expanding its footprint by about a third.
It stalled due to a funding gap caused by the costs of cleaning up an industrial site needed for the expansion. Funding has now been committed by the West Midlands Combined Authority, whose Mayor Andy Street called the project "incredibly exciting".
It will offer visitors the chance to experience what life was like between the 1940s and 1960s with a historic old town and industrial quarter, among other spaces.
Wolverhampton’s iconic Elephant and Castle pub will be recreated and Dudley’s Woodside Library will be rebuilt brick-by-brick on the museum site.
Chief Executive Andrew Lovett said the development "provides added momentum to thrive once again" following the challenges of Covid-19.