Gloucestershire County Council is scrapping plans to cut money from mainstream schools' funding to pay for high needs pupils' provision.
It is understood Gloucestershire will receive an extra £1.35 million this year and next from the government scheme.
Andrew Harris, headteacher at Katharine Lady Berkeley School, welcomed the news: “We are pleased that the Secretary of State has recognised the serious funding pressure on the provision for children with special educational needs and disabilities by making additional funding available for these vulnerable children.
"This announcement will mean that, for 2019/20, funding will not have to be taken from the allocations for the lowest funded mainstream schools, which are facing their own funding pressures, to top up the high needs budget.”
David Drew MP said: “The government has, at last, listened to headteachers, parents and education experts and is finally starting to recognise that schools face a financial crisis.
“I welcome the announcement of extra funds are available and that Gloucestershire County Council is no longer seeking to fill the £3million hole in the county’s High Needs budget by transferring funds from schools’ core budgets.
"It would have been another blow to Stroud schools and children who are already facing budget constraints.
“This is good news, but there is still a long way to go. The deficit in high needs funding in Gloucestershire is £3million and is expected to be in deficit again next year.
"The county council had previously revealed a £1.7m pound gap in its budget for pupils with high needs."
Schools across the county were asked to accept a cut in their overall budgets to help pay for it - but head teachers voted against the plans.
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