Senior councillors have approved plans to buy Grimsby's Freshney Place Shopping Centre.
Cabinet members backed proposals for North East Lincolnshire Council to purchase the centre, on Wednesday.
A council statement said the move would safeguard 1,700 jobs after the centre went into receivership in January and the deadline for bids closed on Tuesday.
A final decision on whether to proceed will go before full council next month.
Council leader Philip Jackson said it was "vital" the authority bought the centre so it could continue its "transformation" of the town centre.
He warned there could be dire consequences for the town if Freshney Place was bought by someone "unwilling to invest", adding the decline of the town centre would be "devastating."
'Critical part' of town
Freshney Place makes up 60% of the town centre's retail offer, supporting one in five jobs within that area, said the council.
Mr Jackson added: "The move to secure the centre will safeguard a critical part of Grimsby town centre's economic and community infrastructure.
"Ensuring it retains a competitive retail and service offer is key to safeguarding up to 1,700 jobs within Freshney Place and Top Town Market."
If plans are approved by full council, experienced managers would be brought in to run the centre with the council taking an "arms-length approach", said Mr Jackson.
Freshney Place's former owners Capreon confirmed that Cushman and Wakefield were appointed as receivers on 18 January.
The council said it would acquire the centre using cash from the national Future High Streets Fund. The exact cost of the shopping centre deal has not been disclosed.