Te Rauone Reserve is set to have a new car park, an upgraded playground, a basketball half court, artwork, better beach access and a picnic area.
It comes as Port Otago works to improve the nearby Te Rauone Beach.
Dunedin City Council parks and recreation group manager Scott Maclean said that during the past century the ocean had eroded the beach, which caused significant issues for the environment and community.
Port Otago was working on a new amenity beach, which involved the recent construction of three breakwater groynes.
It would carry out the sand nourishment phase during winter, which included depositing sand collected from the harbour during routine dredging and placing it on the beach.
Te Rauone Beach coast care committee chairman Graeme Burns said planning was well under way and landscaping on the reserve would begin this weekend with about 30 local volunteers helping out.
A city council spokesman said southern grass skinks had been captured from the reserve and were being housed inside a fenced area at the edge of the reserve to keep them safe during construction work.
Once the reserve work was complete the fence would be removed.
The reserve project was expected to be completed at the end of this year at a cost of $900,000. Access to the reserve could be limited at times during the work.
