The Scalby Road, Stepney Road and Falsgrave Road mini-roundabout junction will be replaced and widened with new traffic lights, which is set to begin on Monday, October 4.
New signal-controlled pedestrian crossings will be installed on Stepney Road and Scalby Road as part of the work to improve safety at four key junctions in Scarborough nears completion.
County Councillor Don Mackenzie, Executive Member for Access, said: "The modifications at these four junctions are designed to accommodate increased traffic flows which are predicted as Scarborough continues to grow.
"In their original layout, each junction was expected to reach capacity by the end of the Local Plan in 2032."
The first phase is due to begin on October 4 and will last for 10 weeks between 7.30am and 6pm on weekdays. It will take place under a temporary lane closure on Scalby Road which will be removed at the end of each day. Pedestrians will be diverted via Cambridge Place.
Essential utility works will be carried out before the second phase can begin, with the scheme due to be completed by Spring 2022.
Improvements have already taken place at the two adjacent junctions of Scalby Road/Woodlands Drive and Scalby Road/Stepney Drive, as well as the junction near Scarborough Hospital.
County Councillor Liz Colling, who represents the Falsgrave and Stepney division, said: "The wider scheme has already brought major improvements at the three completed junctions so I’m looking forward to seeing this one take shape.
"We have liaised with residents whose properties front onto the works and advance warning signs are in place. We apologise for any inconvenience these essential works will cause."
The County Council and Scarborough Borough Council are working in partnership on the scheme, contributing £150,000 each, with the bulk of the funding coming from the York, North Yorkshire and East Riding Local Enterprise Partnership, plus developer contributions.