The handmade outfit, which features a red and black striped top inspired by Dennis the Menace, was made by the drag queen for her hometown look in season two of the show.
It has now been acquired by The McManus: Dundee s Art Gallery and Museum thanks to funding from the National Fund for Acquisitions.
The purchase comes after work The McManus has been doing to support the local LGBTQ+ community through partnership delivery as part of dance company Shaper Caper's learning and engagement project, Here.Me.Out.
This included a series of free events and opportunities for young people to explore LGBTQ+ stories through art, film, audio, dance, drag, theatre and music.
Diamond, who was a finalist on the show, said: "Growing up in Dundee, I never thought that a costume that I have made by hand would be going into be put into a museum for everyone to enjoy.
"I think it's really special that The McManus has picked up on this after my appearance on RuPaul's Drag Race.
"Whether you are gay, straight, trans, lesbian, bisexual, whatever, you are accepted into this space we have created in Dundee."
It is hoped the costume will go on display later this year.
Billy Gartley, head of cultural services at Leisure and Culture Dundee, said: "This is a great acquisition for the city's collections, it is an important part of developing our LGBTQ+ collection and is a great follow on from the Here.Me.Out project.
"Beano and Dennis are synonymous with Dundee's story and we congratulate Ellie for adding to that rich narrative."
Mike Stirling, head of Beano Studios Scotland, said: "This is a genius most-wanted acquisition that confirms McManus as the best-dressed museum in the country.
"Dennis has played an inspirational and empowering role in so many people's lives over the last 70 years.
"Red and black stripes and Dundonian roots are synonymous with him and now this iconic outfit has become a special piece of his history for fans to visit and admire."