WORK is expected to start next year on the major redevelopment of the Bunker Cartoon Gallery thanks to an injection of $2.6 million in funding from the NSW Government.

Money will be used to add a second level to the recently renamed National Cartoon Gallery, which is currently a World War II bunker housing 23,500 historical cartoons.

The expansion design will resemble a WWII Nissen Hut and will create a greater street presence to attract passing traffic.

"Currently when people drive past they can only see the small entrance foyer and don't realise there's a large gallery underground. This high visibility alone will significantly increase visitor numbers," explained gallery chairman Paul McKeon.

The addition will also help protect the 70-year-old structure from further weather damage.

Member for Coffs Harbour Andrew Fraser said the expansion design would enable the gallery to showcase Australian history as seen through the eyes of cartoonists during the past 118 years.

"The funding will preserve and showcase this unique cartoon collection of Australian history to an even wider audience, with offerings that will draw even more tourists to the area," Mr Fraser said.

"With a larger exhibition area and a new multimedia presentation of major events throughout our nation's history, this will truly be the spiritual home of Australian cartooning."

Funds come from the Regional Cultural Fund, which aims to provide inspiration, education and development opportunities for young regional artists.

"It has been my pleasure to see first-hand how the first round of recipients have benefited, and I have no doubt that these new projects will continue to enrich the lives of artists, cultural workers and communities across the State," Minister for the Arts Don Harwin said.

The redevelopment is expected to be completed in 2020.

"The only threat we now face is that we do not yet have an approved development consent from council's planning department, which has expressed concerns about heritage issues." Mr McKeon said.

Coffs Harbour City Council provided an initial payment of $30,000 to cover costs of preparing and lodging a development application.