Work to create a £33 million orthopaedic centre in Kirkcaldy could begin in February.
NHS Fife has approved the full business case for the state-of-the-art centre in the grounds of Victoria Hospital and it will now go to the Scottish Government for agreement.
Fife Council is expected to grant planning permission on December 12.
The project will transform orthopaedic care for Fife patients and will include three theatres, a supporting ward, radiology suites and a pre-assessment unit.
NHS Fife chairwoman Tricia Marwick described it as “the most exciting thing to happen in NHS Fife in a number of years.”
Hip and knee replacements are now among the most common surgical procedures performed in Fife.
Demand is expected to increase by another third in the next 15 years.
The new centre will include an additional theatre and will replace services currently housed in the hospital’s ageing tower block, which dates back to 1967 and is in need of extensive refurbishment.
Drainage problems have previously disrupted hip and knee operations and services have been hampered by flooding and leaks.
As a result, health bosses said doing nothing would present major issues around the safety of facilities and would pose a health and safety and infection control risk.
Despite this, Fife’s orthopaedic service leads the way in Scotland and performed the country’s shortest ever knee transplant last year, with patient Craig Buchanan admitted and discharged within 12 hours.
Mrs Marwick said: “We’re doing absolutely amazing work in Fife in terms of orthopaedics.
“We were the first board to do the one-day knee operation, despite the conditions they’re working in.
“That’s why I’m so excited we’re giving probably the best orthopaedic team in Scotland the facilities they need to get even better.”
The new centre is the largest capital project undertaken by NHS Fife since the creation of Victoria Hospital’s new wing in 2012.
It will be built on an existing car park, meaning parking will be reconfigured to replace the lost spaces.
It is expected to take around 18 months to complete.