Under the plans, the Accident and Emergency department at Poole Hospital will close and move to the Royal Bournemouth Hospital, eight miles away.
Poole Hospital will instead become the major planned care hospital for East Dorset.
Campaigners have criticised the decision, saying it puts patient care in jeopardy but Poole Hospital NHS Foundation Trust says it will improve services for local people and bring huge improvements to thousands of patients.
The two NHS Trusts also plan to merge to become the East Dorset Hospitals NHS Foundation Trust.
The plans include:
£147 million investment in acute hospital services, including a new Emergency Department and Critical Care Unit at Royal Bournemouth Hospital
Redevelopment and investment in Poole Hospital to create a new Urgent Treatment Centre and 14 theatres to help reduce waiting times and prevent cancelled operations for patients requiring planned care
A new purpose built women’s and children’s unit on the eastern side of Dorset
More services provided closer to people’s homes
New ways of working for NHS staff that will make best use of their skills and provide better care for local people
Networks of clinical services for stroke, cardiac and cancer services to ensure that everyone gets the same level of care across the county
We are very pleased that we are now able to move forward in the process of securing a significant investment of £147m into local healthcare and proceed with changes that will make a real difference to local people
These changes represent a once in a generation opportunity to create a healthcare system for the future.