Hold on to your butts.

Smoking may be banned in most businesses and public spaces, but the city is home to several holdouts where it’s still legal to light up a cigarette or cigar indoors.

The newest of the bunch opened last week on the Upper East Side.

Sugar East is one of only eight bars where you can still smoke legally indoors. An outdoor cigar lounge is also located on the rooftop of the two-year-old Knickerbocker Hotel in Times Square, currently operated by Upper East Side cigar bar Club Macanudo.

Sugar East took over the space previously occupied by the 20-year-old Merchants NY Cigar Bar, which closed late last year.

Merchants Hospitality, which operated the original cigar bar, revamped the space with a Havana nightlife-inspired theme and modern cocktail menu.

“We decided to transform Merchants Cigar Bar into a casual smoking lounge, so you can just have a cigarette during a night out while enjoying a cocktail and some great music,” said Abraham Merchant, president and CEO of Merchants Hospitality.

The city’s Smoke Free Air Act, which went into effect in 2003, bans smoking inside restaurants and bars, among other businesses and certain public spaces. But it offers an exemption to establishments that were already in existence, have not moved or expanded, and earn 10 percent or more of their income from tobacco sales. Since the ownership and size of the Sugar East space has not changed, the exemption remains.

Merchant sees Sugar East as appealing to a younger demographic than your typical, exclusive cigar bar.

“Cigar bars in New York are not designed for the millennials, they’re designed for people enjoying cigars, and most millennials don’t know where to have a smoke at the end of the night,” Merchant said. “We decided to give something to people that no one has — a place where you can go and have a good time in a safe environment, so you don’t have to go hide in the back of a club to smoke illegally.”

For social smokers like Danielle Cohen, “having a place to go where you can not only drink but also decide to smoke if you want is an added bonus,” the Midtown East resident, 32, said.

At the same time, the clientele for a smoking lounge is decreasing. Overall, tobacco use — the leading cause of preventable death in the U.S. — has been on the decline nationally. According to the Centers for Disease Control and Prevention, 15.1 percent of all U.S. adults were current smokers in 2015, versus 20.9% in 2005.

Measures such as smoking bans and cigarette tax hikes have helped contribute to that decline, said Dr. Jonathan H. Whiteson, vice chair at NYU Langone’s Rusk Rehabilitation.

“Banning cigarettes in bars was a large step to marginalizing the culture of tobacco use,” said Whiteson, who believes more can be done to further bring the number of smokers down. “If we start to see a rise in smoking lounges, that’s not the culture that we want to be promoting for a habit that is so addictive, so directed at the youth and so lethal in its outcomes.”

With Meredith Deliso