Des Hasler has been given a stay of execution and will remain Canterbury coach at least until the end of next NRL season after a four-hour emergency board meeting.
However, club legend Steve Mortimer stepped down on Friday as a board member, just one day after threatening to quit should Hasler be handed a two-year contract extension.
After the mammoth meeting at ANZ Stadium, Bulldogs chairman Ray Dib claimed the entire board agreed to keep Hasler and negotiations would continue on a new deal.
"The board tonight was unanimous that Des will be there for 2017, and (CEO Raelene Castle) and his management are continuing negotiations going forward," Dib told reporters on Friday night.
"There's significant emotion and heightened pressure around this decision at the moment. We have all agreed that it's in the best interest of everyone involved to take a breath, continue with our extension negotiations and, most importantly, focus on preparations for a 2017 season."
Despite having one year to go on his deal with the club, Hasler's position came under threat after a meek exit against Penrith in week one of this year's finals series.
The Bulldogs finished in seventh place after the regular season but bombed out after losing their final four games, drawing severe criticism from Mortimer.
Dib denied Mortimer was pushed out of the club, saying he realised he had breached the board's code of conduct.
He has instead been offered to become the inaugural member of a newly established Alumni Mentoring Programme, headed by Hasler.
"Absolutely, it was Steve's decision. Steve's been a big supporter of governance. He's realised what he said during the week was inappropriate and hence his resignation," Dib said.
"Steve has been a great servant of our club and will continue working with our club.
"We hope going forward that he'd be a major part of our new Alumni Mentoring Programme that Des is going to start heading up."
Hasler, who hasn't missed a finals series as coach for the past 12 years, fronted the board on Friday for 20 minutes to explain why he should remain at the club.
He said he was confident of producing a better finish in 2017.
"I have the utmost confidence in the systems, structures and strategies that we have in place and I'm looking forward to working with the board, CEO and staff to produce the results we all want in 2017," he said.
