Cheltenham Art Gallery's development project has been awarded a first-round pass for a Heritage Lottery Fund (HLF) grant of £750,000.

While the pass does not guarantee that the scheme will receive the money, it does mean the project has been judged as having potential.

Jane Lillystone, museum & arts manager, said: "We are extremely delighted to have secured the HLF’s endorsement of a project that is so important for the region and spans our activities as both a museum and a gallery.

"We will now actively be working to develop our project to a second-round application, which we hope to submit later this year."

The existing Cheltenham Art Gallery and Museum, which is more than 100 years old, attracts more than 60,000 visits each year, but presently only has enough space to exhibit around a third of its collection.

The designs for the development of the attraction - which received planning consent last year - by architects Berman Guedes Stretton, feature new exhibition galleries, new open access storage, dedicated education spaces, improved visitor facilities and a ground floor café.

The project has already secured £4m of funding from sources such as Cheltenham Borough Council, the Summerfield Trust, The Monument Trust, Friends of Cheltenham Art Gallery & Museum and, most recently, the Garfield Weston Foundation.

Lillystone said: "The target is to reach £5.5m by the end of this year for construction of the new building to start in early 2011."