Kids Company has secured its future after receiving a £3.4 million grant from the Government.
"This happened because there were a lot of very compassionate people in the Government who wanted to deliver to these children," said founder Camila Batmanghelidjh. "On behalf of the children, I am happy."
Kids Company, which helps some of the most persistent young offenders in the country, has frequently been praised by the likes of Prince Charles and Cherie Blair.
But funding has been a problem since Batmanghelidjh founded the charity in 1996. She has twice remortgaged her house to keep the organisation going.
The grant, which covers half its budget for the next three years, came from the Treasury's Invest to Save Budget, which supports projects that deliver public services more cheaply than the state.
The charity is due to receive the money in May. However, chief operating officer Simon Tucker has warned that if it is delayed the organisation could be forced to approach private funders.