The scheme will see kerbs and railings ripped out and replaced by a uniform surface of Yorkstone paving that will be shared by drivers and pedestrians, although traffic signals will remain.
The £40M funding package agreed by Transport for London, Royal Borough of Kensington & Chelsea and Westminster City Council follows 18 months of uncertainty after an application for Lottery funding was rejected.
Kensington & Chelsea deputy leader Daniel Moylan told NCE that the scheme would be a key landmark in the development of shared space projects in the UK.
Shared space consultant Ben Hamilton-Baillie who has been advising the project team that includes architect Dixon Jones and consultant Arup, hailed the Exhibition Road scheme as a "very bold step" following criticism from some local residents.
"We are breaking new ground for shared space and this will be a key scheme to test out the principles," said Hamilton-Baillie.
The team has been working with Guide Dogs for the Blind which has been critical of shared space schemes because it claims that blind and partially sighted people rely on kerbs to remain safe. Guide dogs are not trained to use shared space surfaces either.
"We are still concerned that this scheme will take away the kerb but we have been told that there will be a safe tactile surface for our members," said Guide Dogs for the Blind access policy officer Helen Aluko-Olokun.