Changes to Adelaide Avenue would reduce the daily commute time from Weston Creek and Molonglo to Civic by up to five minutes, the ACT government says.
A dedicated continuous lane from the Cotter Road ramp onto Adelaide Avenue will be added to the stretch of road over the next month.
Minister for Roads and Active Travel Chris Steel said the current set-up, where traffic from Cotter Road merged with traffic on Adelaide Avenue, created a bottleneck on both roads.
About 25,000 cars per day travel on Cotter Road. This is expected to grow to 35,000 cars by 2031.
"The traffic modelling shows that the addition of a continuous lane on Adelaide Avenue from the Cotter Road on ramp will improve traffic flow for Weston Creek and Molonglo commuters whilst not significantly affecting northbound traffic from Woden," Mr Steel said.
The modelling showed commuters on Cotter Road would have five minutes slashed from travel time in the morning peak period.
Commuters on Adelaide Avenue from Woden would experience a five-second delay.
The changes would see the Cotter Road on-ramp continue onto Adelaide Avenue and become the left-hand lane, which would see the T2/Bus Lane discontinued for almost one kilometre and merged with the middle lane.
The decision to move the lane has drawn criticism from ACT Greens transport spokeswoman Caroline Le Couteur, who said the move was "out-of-step" with the government's climate action commitments.
"Today's announcement from Minister Steel flies in the face of his own government's commitments to sustainable transport and climate change action," she said.
"The Greens don't agree to the removal of the long-standing bus and car pool lane on Yarra Glen and Adelaide Ave. We should be building more bus lanes, and giving more priority to public transport and car pooling. That is what will make our city more sustainable and less congested in the long run.
"This is the kind of disappointing decision you get when a government wants a cheap, short-term solution, and when they forget about the about the long-term sustainability of the city."
The works will take place over two stages and coincide with a scheduled resurfacing of Adelaide Avenue, which will start next Monday.
New line marking and signage will be installed in the first stage, which is expected to be completed in the first week of February.
The second stage, a month later, will be delivered with final asphalt resurfacing and line marking.
"With the government undertaking scheduled resurfacing works on Adelaide Avenue from next week, we are taking this opportunity to make changes to the operation of the road network to address congestion on the city's major southern gateway," Mr Steel said.