Gorton Monastery in Manchester has received initial support from the Heritage Lottery Fund in its bid for £222,600.
The project has been awarded a first-round pass, meaning it meets HLF criteria for funding, and HLF believes the project has potential to deliver high-quality benefits and value for lottery money. The project now has two years to submit fully developed proposals to compete for a firm award.
The proposed work incudes repairs and conservation to the deteriorating stonework, original Pugin stencils, marouflage paint schemes, original tiled floors and repair to the altar areas.
The development funding will also allow the monastery to progress with plans for further community and visitor facilities, including a new front wing to house an education and interpretation centre.
Elaine Griffiths, chief executive of the Monastery of St Francis & Gorton Trust, said: "This HLF backing is so important for the future of the monastery. We already provide jobs, projects and events for local people but we will be able to do so much more with HLF funding for this next phase.
"It's fantastic that we're now able to get skilled craftsman back on site to complete the work."
Paul Griffiths, chairman of the Monastery of St Francis & Gorton Trust, said: "Since re-opening as an events venue in 2007 we have generated £8.5m for the city's economy, aside from our own revenues. Unfortunately there was never enough money in the initial rescue and restoration work to repair the altar and sadly they have been deteriorating badly over the past few years.
"The HLF recognise that if we don't act now there is a risk that many of the original works of art will be lost forever."
Sara Hilton, head of the Heritage Lottery Fund North West, said: "The next phase of this project that will not only conserve the historic fabric of the much-loved Gorton Monastery, but build on previous HLF investment and ensure its place in the heart of the community.
"It demonstrates how a heritage building, while providing an important link to a community's roots, can also be adapted for the needs of today."