"It's not just to preserve the land around it, but also to protect the environment," Schwarznegger said during a news conference. "The Hollywood sign will welcome dreamers and artists and Austrian body builders from around the world to continue coming over here for generations to come."
Two years ago, developers put the land on the market for $22 million and advertised it as a great location for luxury homes, which prompted the Save the Peak campaign. Councilman Tom LaBonge partnered with the Trust for Public Land and made a deal with the landowners to sell it for $12.5 million.
Officials said Hefner wrote a check for $900,000, which covered the remainder of the $12.5 million needed by Friday. More than half of the money came from private donations, and the rest came from local and state government.
In a statement, Hefner said, "The Hollywood sign is Hollywood's Eiffel Tower and I am pleased to help preserve such an important cultural landmark."
The land around the Hollywood sign had been zoned to build luxury homes, but now, the land will become part of Griffith Park and the city of Los Angeles.
"We have today a true Hollywood ending. We saved the peak," said Will Rogers, president of the Trust for Public Land.
It's not the first time the Playboy founder has rallied to save the Hollywood sign. Thirty-two years ago, Hefner helped raised money to rebuild the sign.
"The Hollywood sign was falling apart. Two of the three Os were almost gone, one was completely gone," said Hefner. "In June of 1978 I threw a party and raised the initial funds to restore the sign."
The land was originally owned by Howard Hughes in the 1940s, who wanted to build a home for his then-girlfriend Ginger Rogers. After he died, his estate sold the property to a group of Chicago investors in 2002.
Dozens of movie studios and celebrities donated money to the campaign effort to buy the land and preserve it, including J. Paul Getty heir Aileen Getty, Steven Spielberg, Tom Hanks, Rita Wilson, Norman Lear, and The Tiffany and Co. Foundation. There were also thousands of smaller donations from people around the world.