The Government has announced it will invest $278 million into upgrading State Highway 2, between Pokeno and the SH25 intersection.
Work on the popular Coromandel route will begin later this year with its design, consents and property purchase.
The overhaul of the road will then take five years and will be done in several stages.
As part of the project, the 32km road will be widened to include three lanes with two of those lanes heading west towards Auckland.
Transport Minister Simon Bridges says the road will be future-proofed to facilitate four lanes if needed down the track.
"These upgrades will help ease congestion and improve journey predictability, making a huge difference for the local community, the freight industry and for people travelling north after a weekend on the Coromandel."
The upgrade will also look at safety measures on the notoriously dangerous stretch of road, including a new roundabout and four new interchanges to separate state highway traffic from local traffic.
"Improving safety on this popular holiday route is a key part of this project. Over the last five years there have been 18 crashes resulting in 34 deaths and serious injuries," says Mr Bridges.
"Evidence tells us the majority of crashes on this stretch of highway are either head-on or where the vehicle runs off the road so median barriers and guard rails will also be installed.
"The long term goal is to reduce death and serious injury crashes by 80 per cent over 20 years."