World Bank has offered China a $100m loan to clean-up an old mining area in the Huainan municipality.
Post-remediation, the zone will be converted into a park.
According to World Bank, mining industry growth helped to boost the region's economy but also led to large areas of subsidence and degradation of the environment.
About 200km² of former mining land, accounting for about 7% of the municipality, will be cleaned as part of the Huainan Mining Area Rehabilitation project, which will also see the closure of dump sites.
World Bank senior water resources management specialist and the project task team leader Xiaokai Li said: "By applying international good practices in remediation and redevelopment of mining subsidence areas, we hope to help the Huainan Municipal Government redevelop the mining area into a 'green heart' for the city to benefit the local communities.
"As the first operation of its type supported by the World Bank in China, the project can provide valuable experience for other regions facing the challenge of how bringing obsolete and degraded mining areas back to good and greener use."
Under the rehabilitation project, the storm water drainage system will be improved, and vegetation and landscaping will be added, in addition to financing the construction of roads and associated basic infrastructure.
The project intends to support public amenities and economic redevelopment.
According to World Bank, 20,000 local residents will benefit from the improved environmental services.