The Hilsea Lido Pool for the People Trust has reached the final round of Coastal Communities Funding.
If successful, more than Â£2m will be given to the trust to renovate the historic site, but there needs to be evidence of strong public support for the project.
With plans to regenerate the pool, cascades and buildings, it is hoped thatÂ activities will be able to take place all year round.
Sabrina Richards from the People's Trust said: '˜This is an exciting time for all of us.Â We know that Hilsea Lido is far more than just a swimming poo.
'˜If successful, the Coastal Communities Funding would be another step in reinstating Hilsea Lido as a premier venue at the heart of the community.'
Martin Cox is the manager of the Blue Lagoon cafe at the lido.
He says that the money could help bring back the glory days of the area that he remembers as a teenager.
Mr Cox said: '˜Everyone I know remembers what the lido was like when we were kids and it would be great to have that atmosphere back again.
'˜As a teenager it was the ideal place to be, especially during the summer months.
'˜I would love to see this place return to its glory days '“Â it would be good for the local community and good for Portsmouth as a whole.
'˜With proper funding we could see more activity around Hilsea Lido again, so I think it would be fantastic if this bid was successful.'
Portsmouth North MP Penny Mordaunt has also pledged her support to the bid, but says that the regeneration project needs public support to make it a success.
She said: '˜The lido is such a great leisure facility for the north of the city.
'˜We're very close now at making the restoration project a reality, but we need your support too.
'˜If you have fond memories of going to the Hilsea Lido or would back our bid and campaign to restore the lido, we want to hear from you.'
People in Portsmouth can support the bid by writing aÂ letter of support to Ms Mordaunt, addressed to Penny Mordaunt MP, 1000 Lakeside, Portsmouth, PO6 3EN.
There is also an online surveyÂ atÂ https://tinyurl.com/y9xy3p6lÂ Â