Traders in Blackburn have voted 75% in favour of the formation of a Business Improvement District.
The Blackburn BID will use a levy on top of business rates to raise up to £1.5m for the regeneration of the town centre over the next five years.
The money will be spent on promotion and events, crime prevention, creating a cleaner environment and increasing the number of visitors to the town centre.
Mark Smith, owner of the Coffee Exchange and a member of the BID steering group, said: "I am thrilled that the businesses in Blackburn have grasped this opportunity to make a real difference to the future of our town. Everybody has worked very hard towards achieving this great result and we all know that the real work for the next five years is just beginning."
Cllr Maureen Bateson, executive member for regeneration at Blackburn with Darwen Council, said: "This is a fantastic result. It is extremely positive that the majority of the local businesses have voted to get behind the town centre and work together to make it even better. The council will work closely with the steering group to push the town centre even further.
"This news comes just a week after we announced one of our biggest investment programmes in the town centre which will build and enhance what we currently have. Blackburn is open for businesses, visitors and shoppers."
Paul Bury, owner of The Cellblock BMX store, said, "This positive news is very exciting for all the businesses in the town centre. The BID will be run by the business people of the town giving them a real say and making sure Blackburn becomes a vibrant and exciting place to visit."