Picton Target is set be transformed into one of KMart Australia's new concept stores, known as K hub.
Target and Kmart parent company, Wesfarmers, announced earlier this year that 160 Target stores across Australia would be closing down or rebranded as KMart.
The company confirmed the Picton store would be rebranded in early 2021.
KMart Australia regional director John Gualtieri said KHub stores will be different to KMart stores.
"As a business, we're committed to opening stores in new communities, so that we can reach even more people - and we are so excited to introduce the community of Picton to a new concept K hub store in early 2021," he said.
"Think of it as Kmart experience, a little closer to home.
"Now things may look a little different to what you'd expect from a Kmart today.
"We're giving the store a 'light touch' make over for now, so that we're not inconveniencing the community with a long store closure.
"Our priority is getting the store up and running, so that people still have access to the products they need."
Mr Gualtieri said KMart had "big plans to evolve the look and feel of the store over time".
"For now - we've taken our most popular Kmart products across kids, home and clothing; and brought them to life in a new way," he said.
"A curated collection inspired for a smaller format store, with bigger convenience in mind."
K hub customers will have the ability to shop Kmart and Target's full product range online and have items delivered straight to their door.
"Or they'll be able to visit the team in store to collect items, with no additional shipping cost," Mr Gualtieri said.
"We'll be extending this service later in the year to include our friends at Catch.
"So think of K hub as your one-stop-shop for all your favourite Kmart, Target and Catch products."