The grade-II listed Newington Library building in Elephant and Castle has been leased for two years by The Arts Academy from Southwark Council, until longer-term plans are finalised.
Facilities for students of the independent arts school will be available at the site, which had been vacant since suffering water damage in 2013, when the adjacent Walworth Town Hall caught fire.
Short courses and events for the public will also be provided and charity CoolTan Arts will offer creative activities for people with mental health conditions.
The Arts Academy will invite artists and community groups to use the gallery space – formerly the main library – for the duration of its lease.
Artangel, the well-regarded charity, was the first organisation to show an exhibition at the gallery in the autumn. The critically acclaimed Natural Selection was created by father and son duo Andy and Peter Holden.
Observer art critic, Laura Cumming said: “Everything in this marvellous Artangel exhibition – a show of marvels in itself – turns upon the astonishing connections between ornithology and art.”
An affordable housing scheme in Peckham is close to completion, and is set to be handed over to a housing trust within weeks.