The territory government has awarded Abergeldie Contractors a $60 million contract to raise London Circuit, with main construction works to begin later this year.
The work will allow for the light rail line to be extended from its current end point at Alinga Street to Commonwealth Avenue, supporting stage two of the ACT government's plans for it to reach Woden.
London Circuit will be raised six metres to be in line with Commonwealth Avenue, changing the current split-level, overpass-underpass configuration into a level intersection.
New pedestrian footpath links and dedicated cycle lanes will also be built.
Early utility relocation works are nearly complete, allowing for main construction to begin later in 2022 with an anticipated end date of July 2024, though works on light rail stage 2A will continue beyond that point.
Minister for Transport and City Services Chris Steel said raising London Circuit would support infrastructure projects beyond the light rail, such as the renewal of the Canberra Theatre precinct and Acton Waterfront.
"The transformation of London Circuit and Commonwealth Avenue will create a better environment for pedestrians, cyclists and public transport," Mr Steel said in a statement.
"We are not only building the platform for light rail to turn from London Circuit onto Commonwealth Avenue, but removing barriers for cyclists and pedestrians moving through the southern part of the city."
The most disruption will occur from April 2023, when demolition commences on the existing Commonwealth Avenue bridges across London Circuit.
"We'll be asking Canberra commuters to rethink their route, rethink their routine - public transport is a very efficient way of moving large numbers of people around the city particularly at a time when there is going to be disruption," he said.
Mr Steel also said a further works approval application is expected before the end of the year for light rail stage 2A.
Delays are expected in the way of "five minutes" for people using major routes into the city from the south such as Kings Avenue, Mr Steel said, while some "delays in terms of minutes" are also anticipated for those travelling from the north into the city using Parkes Way.
Traffic lights will be installed at Coranderrk Street roundabout on Parkes Way in several weeks time to manage traffic throughout the construction.
"With more people expected to take that alternate route using Parkes Way with the works that will be happening on Commonwealth Avenue, this will better regulate traffic flow through the area," Mr Steel said.
Temporary traffic lights will also be installed on the northern side of Vernon Circle to allow safe right-turn movements onto Constitution Avenue and London Circuit for public transport.
New pedestrian signals and a path around City Hill will also be built during the period, linking Edinburgh Avenue and Constitution Avenue.
The construction program is still being finalised with the contractor, but the ACT government will post updates online.
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