Some 44 members of staff at Museums Sheffield are facing redundancy as the organisation implements wide-ranging cuts.
It comes after the group lost an annual £800,000 grant from the Arts Council, but it has secured £341,000 in transitional funding from the body.
Chief executive of the museum Nick Dodd has successfully applied for voluntary redundancy as the scaling back process begins in earnest.
"I would like to have left the organisation at a time when its future funding was more secure," Mr Dodd remarked.
He observed he has every confidence that the group will be able to overcome the loss of financial assistance and continue to provide a great service.
Under Mr Dodd's stewardship, visitor numbers grew from 370,000 in 2002 to over 1.2 million in 2011.
Some 21 posts are expected to be culled by the end of March, while the remaining 23 positions are going to go in late summer.
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Posted by Trusha Vyas