A proposal to move the library from the iconic Streatham Tate building has sparked a campaign to restore the building to its former grandeur.
The Friends of Streatham Library Group formed last month with the vision of developing the library so that it becomes the heart of the community.
This was a reaction against the Libraries Commission proposing that other locations, such as Gracefield Gardens, should be explored if the library did not improve.
Philip Sidaway, who founded the group, said: "Here is a big chance to do something with the Streatham Tate building.
"It’s a once in a lifetime opportunity and it’s been a gift out of adversity."
Mr Sidaway said they wanted to improve the library, create community space and turn an annex into an arts and crafts base.
He added: "It’s something the community is crying out for.
"It can be the centre of the community, a space for groups to come together and of course a great new library."
Lee Alley, chairman of the Streatham Business Board, said the library was the last remaining public facility in the area.
Mr Alley said: "It’s all we have got left in Streatham. There are no other public amenities."
Helen Smith, Neighbourhood Watch co-ordinator in Streatham South, added: "It’s an opportunity to do something really fantastic."
A council spokesman said it had commissioned an assessment to look at options including moving the library.
He said: "The current Streatham Library building is more than 120 years old but is in a poor condition and does not offer a high quality customer experience."
He added that report on the issue would be brought before the cabinet in the autumn.
Councillor Sally Prentice, the council’s cabinet member for culture, said: "Residents will be consulted before any decisions are taken and whatever the outcome Streatham will continue to have a library open seven days-a-week."