A six-month redevelopment of Stamford Hospital began on Monday.
It will lead to expanded services and improved facilities at the site.
The work is scheduled to be completed towards the end of July 2017 by local construction company Ayres and Gardner, and will proceed in three phases.
Phase 1 includes the expansion of the Outpatient department by creating additional rooms for adults and children, a second ultrasound machine, an improved physiotherapy gym, and a new department for the Pain Management team.
In addition, a state-of-the-art new Bariatric MRI Scanner is planned to be in use from February .
The subsequent two phases will see the creation of an enlarged Phlebotomy department, a new Chemotherapy and Lymphoedema suite, a new Imaging Booking Office, redecoration and refurbishment of existing corridors and reception area, as well as other upgrades throughout the building.