Plymouth is to continue to host the annual British Fireworks Championships for the next five years.
More than 200,000 people regularly watch the firework displays by companies from around the UK.
The city council's cabinet member for Creative Plymouth, Peter Smith, said the deal would boost tourism.
He said: "It's brilliant for the economy and the city. It just pulls people in and we know people book their holidays around the fireworks."
The eight British Fireworks Championships will take place on the Plymouth foreshore in August.
Competitors all have 10 minutes to put on their display, setting off an estimated 10 tonnes of explosives.