The project has been awarded a first round pass of £789,800, which means the project meets HLF's criteria for funding and now has up to two years to submit fully developed proposals. It includes development funding of £59,500 which is available immediately to progress the plans.

The project is to rescue, restore and open the barn to community use so that the building, which is set back from High Street, can become a focal point for heritage and arts.

Internally, visitors will be able to see a rare 15th-century king-post frame which is believed to be from the town's original manor house, possibly the oldest domestic building in the town. In addition to restoration there will also be a new section added to the back of the existing building to accommodate a heritage learning centre with an archive and café.

Welcoming the news, Mike Slinn, chairman of The Dronfield Heritage Trust, said: “We are delighted that the Heritage Lottery Fund has recognised the uniqueness of this historic building, the hard work of all our volunteers and the widespread support of the Dronfield community.”

There is widespread support throughout Dronfield, and the barn project already has a thriving Friends Group. Jean Kendal of the Old Dronfield Society, said: "I am sure I am speaking for all the members of the society when I say how delighted we are that since the Heritage Lottery Fund bid has been successful this fine building with its unique timber features will be accessible to the community.

"The society now has a prospective home for our archive, which we will be able to link with the major record offices. There will be an opportunity to produce a permanent display of Dronfield's history, as well as space for temporary exhibitions on topics of specific interest."

John Harvey, chairman of The Dronfield Civic Society said: "We welcome the news that the HLF is supporting this project to bring into use a building of such historical significance for the town. It will provide a unique community space within the conservation area and will offer generations to come the opportunity to appreciate the local history of the area at first hand"

Emma Sayer, Head of Heritage Lottery Fund East Midlands, added her support: "These are inspiring plans for the hall which is a historically significant building of considerable value to the community. We are delighted to be playing our role as a funder."

Note to editors

A first-round pass means the project meets our criteria for funding and we believe it has potential to deliver high-quality benefits and value for Lottery money. The application was in competition with other supportable projects, so a first-round pass is an endorsement of outline proposals. Having been awarded a first-round pass, the project now has up to two years to submit fully developed proposals to compete for a firm award.