Institute FC's ambitious plans for a revamped stadium have received an £800,000 boost from the Sports Council.
The Drumahoe-based club will use the money to improve spectator facilities at the Riverside Stadium.
It comes just days after the club secured membership of the new 12-team Irish League Premiership.
Club chairman Billy Gillard said the team would "have to work hard on the pitch to attract new supporters through the turnstiles".
"We want to build new covered and seated stands, toilet blocks - provide facilities that are up to modern standards for a family club," he said.
"Hopefully this will take place within the 2008-09 season."
Mr Gillard said the money was the culmination of four years' hard work.