Councillors in Killarney Municipal District unanimously voted in favour of major public realm works to the town's Main Street and Kenmare Place.
It will be the first phase in a six-stage public realm improvement project.
The 7 and a half million euro project (€7,444,891) is being funded through the Urban Regeneration & Development Fund (URDF).
The seven councillors in Killarney MD voted to support the conversion of Main Street to a one-way, 3.7m wide, single-lane road with wide footpaths and landscaping from the N71 junction at Kenmare Place to the Plunkett Street junction.
The original proposal was revised following submissions from a local business and Uisce Éireann, An Garda Síochána and the Department of Transport.
These changes include the extension of a bus/loading space adjacent to St Mary's church and the replacement of automatic bollards with removable bollards.
In the chief executive’s report, Killarney MD manager, Angela McAllen said the majority of the business owners welcomed the project.
She also said several businesses requested that construction work would not take place during the peak summer months.
Speaking at the MD meeting, several councillors said they were concerned the location of a pedestrian crossing was not safe.
In response, senior engineer at Kerry County Council, David Doyle said the proposed location is the safest, offering the best visibility to motorists.
The plan was passed unanimously.