Development plans are in the pipeline for the market square in Hemel Hempstead.
Under work agreed by council bosses the bus station will be moved into Marlowes – near the junction with Bridge Street – to free up the former market site.
Councillor Terry Douris, cabinet member for planning and regeneration at Dacorum Borough Council, said: “It creates the potential to bring forward the market square and bus station for regeneration.
“If we can achieve it, it will provide an important connection between the northern end of the town centre and the traditional Marlowes shopping area.
“It has the potential to be hugely exciting.”
A meeting of the council’s cabinet last week also agreed to lay the groundwork for £3 million of improvements to Marlowes, including repaving the pedestrianised area and installing better lighting and seating.
“The whole thing will be a more attractive place, new lights, places to sit, trees and planting, improved child play facilities,” Mr Douris said.
“Three million doesn’t go a huge way. In terms of construction we could spend ten times that, but we have to cut our cloth to the funds available.”
Work is expected to start at the end of next year and finish in 2015.
The market in Marlowes is expected to be revamped in the new year with new standardised stalls in a revised layout.