Isle of Wight Council bosses have overturned a vote by councillors - who had rejected the partnership to secure £900 million of funding.
Chichester To Get 20mph Limit
20 mile per hour limits will be introduced on Chichester's residential roads.
West Sussex County Council had previously voted in favour of the slower speeds to try and improve road safety.
They say out of more than 4,000 replies in a public consultation last summer, 77% were in favour.
The 20mph limits are signed only and do not involve humps. Some major roads are excluded. Developer Section 106 funds will be used.
20's Plenty for Chichester's founder Sarah Sharp, said:
"We are overjoyed that Councillors have backed 20mph limits for Chichester's residents. Our streets will be safer for everyone, especially the vulnerable - children, elderly people and the disabled.
"The UK is the most car dependent country in Europe, and also the has the most obesity. Increasing active transport - walking and cycling - helps our health.
"We need safe, pleasant streets for people where we live, shop and work. Some people are scared of the roads and pass this fear on to their children. A whole generation has grown up reliant on the car even for short journeys. To increase walking and cycling we need a general atmosphere of safety. We believe that slower speeds are a key solution"
The busy road's being made two lanes in both directions between Segensworth and Titchfield - it's due to take 18 months.
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