The 409 Project has been running since 1981 and works with about 60 young people aged 10 to 17 every year, providing a range of activities and advice.
Lambeth Council has funded the scheme with about 110,000 a year, but cut its grant in April. A three-month extension has now also elapsed.
Micheal Gordon, director of the project, said: "The youth offending service in Lambeth believes that our service is not a high priority."
Lambeth Council said it would be delivering programmes previously commissioned from the project.
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