A Pembrokeshire hospital's accident and emergency unit will quadruple in size with a near-£9m investment.
There is an ongoing review into the future of acute services in Wales
The NHS trust has been told it can go ahead with plans to build the new unit at Withybush Hospital in Haverfordwest.
Managers say it will create one of the most modern developments in Wales, able to treat 50,000 patients a year.
Health watchdogs have welcomed the money but say they still have concerns other services could be lost under a review of hospitals in west Wales.
The new unit will see the refurbishment of the existing building alongside an adjacent new building.
The centre will house emergency services, plus other out-of-hours facilities including GPs, district nursing and social services.
Keith Thomson, chief executive of the Pembrokeshire and Derwen NHS Trust, said: "This is fantastic news for Pembrokeshire.
"It means Pembrokeshire people will be the first to benefit from a fully integrated emergency and unscheduled care facility that is at the forefront of modern A&E services across the country."
The announcement of the £8.75m investment is against the backdrop of a review into hospital services in mid and west Wales that could see some departments at Withybush downgraded.
Another option being looked at would eventually see Withybush and West Wales General in Carmarthen closed and merged into a new "super hospital" on a site near Whitland.
The trust said the new investment would go ahead irrespective of the outcome of that review.
Ashley Warlow, chief officer to the Pembrokeshire Community Health Council (CHC) said: "We are delighted that the accident and emergency project has received full approval.
The A&E unit will include:
Emergency centre capable of treating 50,000 patients a year
Clinical decision unit with immediate access to surgery
Key out-of-hours services including GPs and district nursing
Social assessment unit for progression to secondary care
Source: Pembs NHS Trust
"This upgrade is long overdue and has received the full backing of the CHC from the outset."
However, he said there were still concerns about other services at Withybush.
"We must not lose sight of the fact that this new facility must be a component part of a fully functioning district general hospital with a full range of core in-patient services," added Mr Warlow.
"To establish such an A&E and perhaps merely stabilise patients and move them to an acute hospital outside of Pembrokeshire would be unacceptable.
"To retain core acute services at Withybush, together with this new A&E facility, would then adequately provide for the future needs of Pembrokeshire in a very positive manner."