Blackpool Council is to demolish five residential tower blocks in the Queens Park area of the town and build new low-rise housing.
The seven-year project will halve the size of the estate from 500 units to 250. Queens Park is a short distance from the town centre and the beach. The estate is managed for the council by Blackpool Coastal Housing.
The council said: "A decision has been taken by the council to revitalise the estate into a safe and attractive neighbourhood inhabited by a balanced and sustainable community."
A residents group has been established to have input into the design and planning of the new estate.
The council is looking to procure a lead development partner to work with the council, Blackpool Coastal Housing and the Queens Park Residents' Group to prepare a fully costed masterplan for the comprehensive redevelopment of Queens Park in a number of phases, lead on the demolition of the existing blocks, design and build approximately 150-180 new housing units, landscaping and community facilities for Blackpool Council, develop approximately 50 two- and three-bed homes for sale on the open market in phases.
The deadline for expressions of interest is 26 March.