This national award was for an ''outstanding'' new project that contributed to best practice in the museum sector and demonstrated ''excellence, relevance and vision''.
Settlers museum director Linda Wigley said museum staff were very pleased to gain national recognition through the award, presented at the Museums Aotearoa national conference in Hamilton late last week.
The award showed the museum was continuing to solidify its place as one of the country's best new museums, officials said.
More than 150,000 people have visited the museum since it reopened last December.
Ms Wigley said some people tended to think of Dunedin's museums and the Dunedin Public Art Gallery as mainly ''local'' attractions.
But the Museums Aotearoa award showed the city's museum and gallery sector was actually attracting positive attention to the city at the national level.
She believed the city's cultural institutions were a ''huge tourist drawcard'' for Dunedin.
The award citation noted that the museum redevelopment was a ''transformational project'' , and the museum had doubled in size.
This ''bold initiative'' had aimed to bring the museum's ''extensive social history collections together with a large transport collection''.
And a ''sensitive design'' had combined a ''well-loved museum building with an Art Deco bus station, respecting the special character of each while creating a thoroughly modern museum''.
The redeveloped museum told the stories of Dunedin's many settler communities and staff and visitors would enjoy this ''renewed Dunedin landmark'', the citation noted.
At the Museum Aotearoa annual awards, the Dunedin Public Art Gallery was shortlisted for the exhibition ''Sound Full''.
The gallery was also shortlisted for design excellence awards in two categories at the Museums Australia Multimedia and Publication Design Awards. Winners will be announced next month at the organisation's national conference in Canberra.
