Teachers and pupils at York's smallest secondary school celebrated the end of term by forming a human chain around their school after learning it had been saved from closure.
Closure had been a possibility for Burnholme Community College since January because of falling numbers.
Only 370 pupils attend the 600-place secondary, which was rated good by Ofsted in May.
But York City Council has agreed a recovery plan for the school, which includes writing off a Pounds 120,000 budget deficit.
Headteacher Simon Gumn said: "This is a terrific vote of confidence for the staff and students.
"We will return in September refreshed and renewed, ready to take Burnholme Community College into the next phase of our mission." WS.