Up to £1.155 million is available from the Heritage Lottery Fund (HLF) for the renovation of the Scapa Flow Visitor Centre and Museum.
The scheme involves restoring the historic buildings, the enhancement of interpretation and displays, and the creation of a new building which will house an exhibition space, café, toilet facilities and information areas.
HLF's support completes a major funding package made up of grants from Historic Environment Scotland, Highlands and Islands Enterprise, the Orkney LEADER fund and Capital Projects programme.
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Work is due to start in spring 2018, with tender documents being issued towards the end of this year.
Cllr Rob Crichton said: "Attracting such a high level of external funding to this project is a real success story for one of our most fragile island communities. The restoration will not only ensure the future of our collections, but also support the local community in Hoy, which relies on the centre to attract visitors to the island, with more than 14,000 visits in 2016."
The council's Executive Director of Education, Leisure and Housing, Wilfred Weir, added: "The renovated museum and visitor centre will be a fantastic asset to Lyness, Hoy and Orkney as a whole and celebrate the importance of Scapa Flow in the history of our country. As well as being a valuable resource for visitors to our islands, it will help preserve artefacts for current and future generations at home here and abroad."
(LM/MH)
