A Portsmouth mental health charity said it has been forced to close after 50 years.
Portsmouth Mind blamed the decision, which was made at its recent annual general meeting, on council cuts.
Chairman Roger Batterbury said the charity, which currently serves 50 people, would have to make its two staff redundant.
Portsmouth City Council said the charity had chosen not to bid for extra funding it had made available.
Mr Batterbury said the withdrawal of a £300,000 grant by the council two years ago had left it relying on other sources of income.
He added the local authority had chosen to fund "charities which can save the council money, not save residents' lives".
Portsmouth Mind was founded in 1965 and worked with people with depression, bipolar disorder, borderline personality disorder and post-traumatic stress disorder.
Mr Batterbury thanked Portsmouth's two MPs, Waitrose, the King's Theatre and the girls of Portsmouth High School for donations.
Leader of the city council Donna Jones said she was "very sad" to hear the charity was closing, but added it had not bid for a portion of a £500,000 voluntary and community sector transition fund.
A spokesman for the council also said it gives Solent Mind, which covers Portsmouth, about £200,000 a year.
He added that this financial year the authority will spend around £4.9m on mental health services.
The city council plans to cut £11m from its next budget and wants to reduce funding in areas including health, bus services and community centres.