After months of uncertainty, the Australian Rugby Union (ARU) has confirmed Western Force will continue to be based in Western Australia.

The ARU and RugbyWA announced on Friday they have finalised an alliance agreement, which will see Super Rugby outfit Force remain in Perth.

Financial problems have plagued Force for some time, stemming from a combination of poor on-field results and their distant location from rugby's heartland in Australia.

Under the terms of the agreement, the ARU will integrate the professional Rugby program of Western Force into the High Performance Unit.

The agreement also means Force is not a stand-alone entity anymore, and all their players and staff are now employees of the ARU.

"RugbyWA and the Western Force are not alone in their challenges to remain viable as a professional sports entity in Australia," ARU chief executive Bill Pulver said in a statement.

"Numerous teams across several codes are facing the same economic environment across professional sport and the ARU has been looking at ways to create a more efficient and effective way to run our Super Rugby businesses.

"The ARU and RugbyWA have collectively created a model which we believe will be more sustainable for our Super Rugby organisations in Australia.

"The other really important outcome is that the Western Force will continue to be deeply entrenched in the Perth community. They will continue to have a brand which is unique to them."

The deal is reported to last for at least the next four years when a new broadcast agreement is set to be negotiated.