Healthcare services in South Gloucestershire are set for a boost after the council announced it was purchasing the Thornbury Hospital site.
The aim is to redevelop the site near Bristol.
Plans for the site potentially include a base for GP surgeries, enhanced mental health support and support for older people to receive care at home.
The land sale is expected to be approved by South Gloucestershire Council's cabinet next month.
North Bristol NHS Trust owns the hospital but the adjacent health centre is owned by NHS Property Services.
There have been several unsuccessful attempts to upgrade the facilities over the past 30 years.
However, there was a breakthrough earlier in January at meeting between all the relevant partners.
It follows a £13.3m bid in December for government redevelopment funds.
Luke Hall, Conservative MP for Thornbury & Yate, said he had secured the support of Health and Social Care Secretary Matt Hancock for the project.
"It will mean our community can access the care they need closer to home," Mr Hall said.
Separately, £100,000 has been secured from NHS England for a feasibility study to assess the need for rebuilding the GP-led health centre.
The cost of the hospital land sale has not been disclosed because of commercial sensitivity.