Muppet creator Jim Henson's family is donating about 400 puppets, costumes, props and other items to the Museum of the Moving Image.
New York City Mayor Michael Bloomberg was on hand for the announcement Tuesday.
The museum plans to build a new gallery to house the new contributions. The city is chipping in $2.75 million toward the $5 million project.
The donation also includes objects from other shows and films on which Henson worked, including "''Fraggle Rock" and "The Dark Crystal."
The new exhibit is expected to open in 2014.
The 1984 film "The Muppets Take Manhattan" depicted the fuzzy crew striving to stage a Broadway musical.
The museum is marking its 25th year.
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