The city is getting a donation of almost 10 acres for a linear park along an old railroad bed leading from the Riverwalk to Alton Park.
The Trust for Public Land is making the donation of the property that crosses Broad Street near WDEF TV, then goes under Alton Park Boulevard before reading 38th Street.
The line was once used by the Nashville, Chattanooga and St. Louis Railroad as a spur to serve Alton Park industries.
It has been abandoned for about a decade.
The line includes a bridge across Chattanooga Creek near the new section of the Riverwalk.
The city will reimburse the Trust for Public Land $11,300 for a survey and $17,923.50 for environmental work.
The city has applied for grants to construct the trail.