Stepney residents will be able to explore the area's great cultural diversity with one of the largest celebrations of the Bengali New Year anywhere outside of Bangladesh.
The Baishakhi Mela takes place in the second weekend of May and is the largest open-air Asian festival in Europe.
Having been arranged by Tower Hamlets Council since 2008, it will now once again be run by the community from next year.
In 2011, more than 120,000 people visited east London for the festivities, which are second only to the Notting Hill carnival in size.
Lutfur Rahman, mayor of the borough, said that the council will continue to support the event.
He said: "The Mela is a fantastic inclusive event which celebrates and shares Bengali culture with a much wider audience and it is now the right time to return the organisation of the event to the community."
It is expected that the new organisers of next year's event will be selected by the autumn.