A town in Powys will be one of 10 areas in the UK, and the only in Wales, to pilot new technology for tackling so-called broadband not-spots.
Llanfyllin will test broadband enabling technology (BET), a new fixed-line solution for delivering the service over longer distances.
BET provides broadband up to 7.5 miles (12km) away from the exchange - more than double the current limit.
There have been concerns about the number of "not-spots" in rural Wales.
In November 2007, regeneration group Mid Wales Partnership said black holes in rural Wales' broadband network were putting the area in danger of falling behind the rest of the UK.
Talks aimed at improving access in remote areas of Powys have also been held between the public and private sectors and politicians.
British Telecom (BT) is behind the project to improve broadband coverage.
It said initial trials in Inverness and Dingwall in Scotland had proved successful.
BT's director for Wales Ann Beynon said: "We're really excited about the potential of BET to extend broadband to many of the remaining 'not-spot' areas.
"By rolling out BET, we can help customers and assist the UK Government to realise its aim for a universal 2Mb/s broadband service.
"We're keen to work with local and regional authorities and other bodies with available funding to discuss how the technology can be rolled out to more Welsh homes currently unable to receive broadband."
BT said if there was funding to help meet the additional costs involved in deploying the technology, BET could offer a reliable and cost-effective solution to assist the UK Government's ambition of delivering a minimum 2Mb/s service to virtually all UK homes.
Deputy First Minister Ieuan Wyn Jones said: "This is extremely positive news for residents and businesses in Wales, who are unable to access broadband due to long telephone lines.
"The Welsh Assembly Government is committed to working with the industry to address any remaining broadband not-spots across Wales."