Work on a £50m development which includes shopping and community facilities will start this month, a Staffordshire council has said.
Hednesford's Gateway scheme involves two sites, on Rugeley Road and Victoria Street.
Phase one includes building premises for Hollywood Bingo Club and the Reserve Forces and Cadets Association.
Cannock Chase Council said preparation work on phase two, which includes a new Tesco store, was planned for June.
The second phase is to include a terrace of non-food stores near the 80,000-sq ft Tesco store.
The council's head of planning and regeneration, Bob Phillips, said: "The new stores will attract many new shoppers into Hednesford centre each week.
"This will bring new opportunities for existing traders and the traditional shops along Market Street."
The proposals for phase two also include a new 10,000 sq ft community facility to replace the existing Aquarius Community Dance Hall.
The existing Heritage Trail which connects Market Street to Hednesford Park would be enhanced through landscaping and improved footpaths.
Mr Phillips said the scheme "marks the culmination of many years of effort to secure a better future for Hednesford".
Regeneration specialist firm St. Modwen said the scheme would create "a safe and welcoming retail and leisure environment within Hednesford that has been designed to foster a positive visitor experience for years to come".