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Connor Kitching, seven, and his family from Hillingdon in Middlesex, England, were planning to visit Disney World in Orlando in October to celebrate Connor receiving the all-clear from liver cancer.
Lauren Atkins, a friend of Connor's mother Katie Butler, told the PA news agency: “Back in 2017, the community did a lot of fundraising and raised quite a bit of money to send Connor to Disney World with his family.
“It was booked after Connor got the all clear. Due to the Thomas Cook breakdown the whole holiday was canceled as it was booked through Thomas Cook.
“We've been contacted today from British Airways who have now covered the cost of the flights and accommodation so that the family don't miss out on the holiday."
Connor was given the all-clear from cancer in November 2018 after being diagnosed in April 2017, and undergoing treatment at Great Ormond Street Hospital.
The family were entitled to a refund from Thomas Cook, however due to delays as a consequence of the company's collapse, a refund would not come through in time for the family to stick to their original booking.
After hearing about Thomas Cook's collapse, Atkins, who helped the family to fundraise for the vacation in 2017, took to Twitter to speak about the holiday's cancellation.
She had told PA: “Since the news yesterday morning, Katie messaged saying it's canceled, the boys are devastated, Connor's absolutely heartbroken."
Atkins sent tweets which were seen by BA, who then offered to fund the family's flights and accommodation.
British Airways responded to Atkins on Twitter, saying: “We hope you have an amazing time at Disneyland! Congratulations on getting better too, Connor!"
After tweeting about the vacation cancelation, Atkins said she also had interest from Tui, Make a Wish and Virgin in funding the trip.
BA provided 14 nights of accommodation for Connor, his mother, his father Stephen Kitching, and brother Charlie, as well as business class flights from London Heathrow to Miami.
Atkins said: “We cannot thank British Airways enough for literally stepping in, they've kept the same dates, so the family will still be flying out on October 2 now.
“They've literally changed a nightmare today!"