Dorset Council has agreed to buy a dairy farm as part of a green project which will see the local authority rewild the land.
In its current form, Middle Farm, located at Higher Kingcombe in West Dorset, is 'not ideal' due to concerns over pollution, the council said.
The 'intensive' farm sits alongside a Dorset Wildlife Trust (DWT) nature reserve, with fears centred on run-off and soil erosion.
It is not known how much Dorset Council paid for the farm, however, it recently received a grant of over £4.6m from the government.
In a statement, the local authority said: “The land is ideally located to deliver both nutrient reduction and nature recovery in the headwaters of the River Hooke.
"Changing its use to woodland or rewilding can reduce nitrates as required and could be achieved with little investment."
The council said it was being supported by Natural England and that there had been 'positive' talks with Dorset Wildlife Trust over the project.