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The new section dedicated to the club at Brighton Museum and Art Gallery will open in August.
It follows a successful exhibition marking the club’s first year in European football.
Albion celebrate their 125th anniversary next season.
Seagulls chairman Tony Bloom said: “This is a wonderful opportunity to tell our Sussex and global visiting fanbase about the journey that the club has been on, re-live some of the milestones and history we continue to make and celebrate 125 years of the club.”
Deputy chairman and chief executive Paul Barber highlighted the importance of having a long-term presence in the city.
He added: “We are delighted that this permanent home, that is so accessible to the city and our visiting support, will be a defining part of telling the club’s story and preserving our heritage and history to a wider audience.”
The exhibition marking the European campaign has been extended due to its popularity.
Brighton and Hove councillor Ty Goddard said: “As we turned the Royal Pavilion lights blue and white on that important day for the club, when the Albion played in Europe for the first time; another idea was born – the club in the city – and the club museum in the city’s museum.
“My heartfelt thanks to all those who have made this partnership happen.”
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