There is also a substantial taonga Maori collection with items from Ngati Awa, Ngai Tuhoe, Ngati Tuwharetoa, Ngati Rangitihi and Te Whakatohea, and the internationally significant Te Kōhika Collection of prehistoric archaeological material.
"Currently just a small part of the collections are accessible at any one time and the public, including researchers, need better access to ensure they remain relevant and meaningful to them," said Ms Barry.
The redevelopment will also see a new lift to improve accessibility, an education and teaching space, improved working areas for staff and energy-efficient climate control.
"I would like to acknowledge the work of local MP Hon Anne Tolley, who has been a major advocate and supporter for this important community project."
Construction is due to start early in the New Year and is expected to take around 12 months to complete.
Whakatane Museum and Research Centre becomes the second recipient of funding from the newly reconfigured Regional Culture & Heritage Fund, following a grant to the Nelson School of Music announced earlier this month.
For more information about the Regional Culture & Heritage Fund, visit www.mch.govt.nz/RegionalCultureHeritageFund.