As well as a full refurbishment of the whole building, the project promises enhanced facilities and services to customers and the wider community.
And assurances have been given that consideration has also been given to preserving and retaining the Grade B listed elements of the original Andrew Carnegie-funded building, which opened in 1905.
Modern, accessible changing facilities for the swimming pool will be provided and will offer flexible accommodation for families and those with a disability.
A new, purpose-built health village will have sauna, steam and spa services, with direct access to the swimming pools.
The existing training pool will be replaced with a modern deck-level 25m x 6 lane facility and will have an underwater, movable floor which will provide flexibility in meeting the needs of a wide range of uses. Consideration has also been given within the design of this area to ensure that the new pool sits well in its Edwardian surroundings.
Viewing has been introduced from a new cafe on the ground floor near to reception to create a focal point for customers to relax, watch and enjoy the activities taking place in the swimming pools.
An indoor play centre will offer parents and carers a new facility for children, and there will also be a separate themed room available for birthday parties and other functions.
The new reception area will offer a much improved open-plan area, providing better customer access and communication, while retaining the architectural features of the original building.
Creation of two purpose-built aerobics studios will provide significant additional capacity and give 40 hours of additional programme time for clubs, casual users and sports development/community programmes in the refurbished main sports hall.
A modern health and fitness suite will offer the very latest in state-of-the-art equipment, with sufficient additional space to offer an 80-station gym, double the size of the existing facility.
A new spinning (RPM) room will accommodate group spin cycling and activity classes and give increased scope to develop programmes for different groups.
Overall, the refurbished facility will offer an additional 1500 square metres of internal space.
In order to support the preservation of the Grade B listed elements of the building, an enabling works contract will start in early January 2009 for three months. The main contract is scheduled to start in April 2009 with completion due in autumn 2010.
This will be followed by the installation of equipment, final preparation of the building for customers to use, staff orientation and training.
It is expected that the new facility will be open by no later than January 2011.
Fife Sport & Leisure Trust is continuing to work with sports clubs and customers to reduce the impact of a lengthy closure by arranging for access to alternative facilities.
Councillor Brian Goodall, strategic chairman of the housing and communities committee, said: "I am delighted that through a design process based on extensive consultation, we have been able to maximize the potential of this facility.
"The restoration of some of the original features of the Andrew Carnegie building, combined with significant improvements to the whole facility will not only broaden its potential use for all sections of the community, but ensure that the Carnegie legacy will be maintained for many more years to come."
Ed Watson, chief executive of Fife Sport and Leisure Trust, added: "We welcome the major investment from Fife Council in refurbishment of Carnegie Leisure Centre and look forward to operating what will be a state-of-the-art facility upon completion of the project.
"In the meantime, we are continuing to work to ensure that our customers will have good access to alternative facilities during the upcoming closure."