The busy bus route between Melton, Oakham, Uppingham and Corby will once again be run by Centrebus after it was handed a new five-year contract.
The future of the RF1 service, which carried 120,000 passengers last year, looked under threat five months ago when the company decided to stop running it because it said it was no longer financially viable.
Rutland County Council put the route up for tender but it attracted only one response, from Stagecoach, whose bid of £270,840 per year was an increase of £220,448 on the existing Centrebus contract.
Cabinet members provisionally agreed to fund the new contract but asked officers to look for a more cost-effective operator before making a final decision.
Centrebus, which has continued to run the RF1 buses in the interim, re-entered the bidding when another tender was launched and its offer to run it for £122,000 a year, with a new stop included at Corby Railway Station has now been accepted by the council.
The new contract represents an annual increase of around £70,000 in revenue for Centrebus compared to their previous contract.
Councillor Lucy Stephenson, portfolio holder for transport at Rutland Council, said: “The council has worked hard to protect RF1 for the passengers who rely on this service.
“We’ve held a thorough procurement process which set out to ensure the continued operation of RF1 while also delivering best possible value for public money.
“I hope residents and, in particular, RF1 users will be pleased that we have been able to do both.
“We have increased funding for RF1 to keep the service running and improve the route – something that has only been possible because of prudent financial management and making best use of our limited resources.”
The new stop at Corby Railway Station was agreed following a request for comments on the service from passengers and county councillors.
A revised timetable for the RF1 service detailing this change will be introduced from September.