Groundwork scooped the grant after winning about 60 per cent of the 20,000 votes cast by GMTV viewers across the UK. The rest of the votes were split evenly between the other two contenders, the Coal Industry Social Welfare Organisation and the National Youth Theatre, but they did not win any money.
Stephen Dunmore, chief executive of the BLF, said the shortlist was compiled so as not to pit controversial causes against each other. He said the fund favoured "popular rather than populist" subjects.
"Very clearly, environmental issues are important, not least because they are issues the public can understand at a local level," Dunmore said.
"To give people a choice, it was perfectly sensible to put these subjects in amongst each other but we wouldn't, for example, put a hospice up against a refugee and asylum seekers' project."
Groundwork's programme, Safe and Sound, will bring young people and adults together to transform 25 derelict and dangerous eyesores across the country into safe, clean and green environments.
Dunmore said the positive public response indicated that People's Millions was likely to be a great success.
"We've got further rounds to go," he said. "It will be interesting to see whether the public interest is maintained. The important thing is that it makes people feel more involved with the decisions being made." He added that the competition would undergo a thorough evaluation later this year.