Plans to turn a former scout hut into an Islamic centre have been turned down.
Islamic charity the As-Salaam Trust wanted to take over the hut at Thurnby Lodge, Leicester, but have faced sustained opposition.
Campaigners wanted the disused property to be developed for use by the wider community.
However, the city council has agreed to lease the nearby Raven Centre to the Islamic group.
The decision comes after a consultation with local residents.
City mayor Peter Soulsby said: "The results of the consultation show the vast majority of people who responded are in favour of the community taking on responsibility for the former scout hut, and As-Salaam taking on the Raven Centre.
"This option meets everyone needs, and I am therefore offering both groups the opportunity to make this happen."
More than 7,000 leaflets containing a questionnaire were delivered to homes in Netherhall and Thurncourt to tell residents about the proposals and to ask for their views.