The $46 million investment aims to create immediate jobs in construction and drive visitation and ongoing employment.

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Central Goldfields Shire mayor, Cr Chris Meddows-Taylor said he was thrilled to see the project secure $1.2 million in additional funding for phases 2 and 3.

"Identified as a priority project in the Central Goldfields Shire Tourism and Events Strategy 2020-2025, and as one of council's priority projects, we are thrilled we can now deliver this project in its entirety," he said.

"This funding will allow the redevelopment project to get underway as soon as possible and it will also open up many new opportunities to a present a greater variety of art and exhibitions for the community and wider region.

"We are excited at the increased exhibition space and associated increase to the variety of exhibitions we will be able to present and the way in which visitors will be encouraged and welcomed to visit their very own local art gallery."

The redevelopment will see the gallery refurbished and extended, including opening the original fire doors at the front of the gallery, increasing gallery exhibition spaces and the installation of improved environmental and climate controls.

Also included will be remodelling to internal gallery spaces, improved storage facilities for the shire's art collection, creation of an open contemporary reception and improved accessibility and visitor services amenities.

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External landscaping including the installation of an Indigenous Interpretive Garden will round out the project.

Other projects that received funding in the region included Welcome to Dja Dja Wurrung Country in Castlemaine, the Goldfields Track Transformation from Ballarat to Bendigo Stage 1 and the Great Stupa Event.

To see a complete list of projects supported by the program, click here.

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