Myndtown Church, in Shropshire, has secured Heritage Lottery Fund money to restore the Grade II-listed building.
The plans will see £20,600 spent on the development phase, which will last up to one year, with another £202,500 earmarked for construction.
Reverend Norman Morris, rector of Myndtown, welcomed the news.
"Myndtown is one of a number of hill villages in Shropshire with tiny populations, and it's not got many parishioners, but it's got a lot of history," he said.
"It's in a wonderful position, it's got potential for walkers and cyclists to use it as a kind of centre, and a lot of people really value it."
The building work will provide Myndtown Church with a new roof, repairs to stonework, re-rendering of interior and exterior walls and underground drainage.
Local fundraisers had already raised £8,000 towards the restoration scheme.
John Burt, organiser of the project, thanked the Heritage Lottery Fund for the grant.
"Without them, it would have been impossible to raise so much money and the historic church would have been likely to close and fall into ruin," he said.
"I don't think you could justify necessarily spending that kind of money to keep open a small church with very few people attending, but I think the significance of the building goes beyond that.
"In Victorian times, when many churches were completely changed, this has been largely untouched - it's like a building from 800 years ago."
More than £220,000 will be used to renovate a 12th Century village church, even though it has just 19 registered members.