A kidney dialysis unit will be built at Ramsey and District Cottage Hospital, the Manx Department of Health has said.
The procedure is currently carried out at Noble's Hospital in Douglas. It treats about 1,300 patients each year, using seven dialysis stations.
But the service needs to be expanded due to an increasing number of patients, the department said.
The new unit will have four dialysis stations but it is hoped that will increase until six.
'Closer to home'
Health minister David Anderson said: "The department's decision to develop a community renal dialysis satellite unit at Ramsey and District Cottage Hospital will contribute greatly to relieving some of the pressures that this demanding service is experiencing.
"It is also consistent with the department's approach of services closer to the patient's home."
Janet Grib, Ramsey hospital manager, added: "I am delighted with the Department of Health's decision to locate this much needed, predominantly nurse-led service within our community hospital at Ramsey.
"We are looking forward to working alongside our colleagues in secondary care, in order to train our staff and to develop this specialised community service for the island's population."