The Badung regency government purchased the land where the former Sari Club stood when it was attacked on October 12, 2002.
It's been welcomed by family members who lost loved ones in the bombings.
"We're excited by this purchase, which is the culmination of decades of work by our association to keep the site earmarked for such a development," Bali Memorial Association spokesperson Keith Pearce said.
The association has been pushing for a peace park to have the terrorist attack properly acknowledged and remembered.
The wreckage of the Sari night club where 88 Australians died in a terror bombing in 2002. (AP PHOTO)
A delegation travelled to the regency to meet with officials in March 2024 and the government expressed support for the initiative after attempts to privately purchase the Sari Club side ceased, the association said.
A formal announcement about the intended development plan is expected on February 6.
"The Bali Memorial Association looks forward to working with the Regency and other authorities to ensure an appropriate development that tells the story of those that were lost in a respectful manner and points to the need to combat terrorism to create a peaceful future," Mr Pearce said.
The Australian Department of Foreign Affairs welcomed the purchase and the plan to develop an appropriate place for reflection.
"We hold in our hearts those we lost in the Bali bombings, the survivors and first responders, and those who have since carried the burden of loss," a department spokesperson said.
"The Australian consulate-general in Bali will continue to engage regularly with the Badung Regency on the site's development."
Three bombs killed 202 people in the Kuta tourist district in what became the worst loss of Australian lives due to a terrorist attack.
Hundreds more were injured.
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