West Lindsey District Council is introducing the new offer from the start of April to encourage more visitors and shoppers to the town centre.
Coun Trevor Young, ward member for the South West Ward of Gainsborough, said he hoped the move would provide a ‘boost’ to traders.
He said: “I welcome the news of the one hour free parking and the addition of extra car parking in the centre of Gainsborough.
"We hope this will encourage people to shop local and support businesses and traders at our Tuesday and Saturday markets.”
As previously reported, 67.9 per cent of people who responded to the survey opted to allow the first hour of parking to be free and charged thereafter between the hours of 8am and 6pm.
Motorists will still need to collect a ticket from the machines and place it in their vehicles to display, this includes pay by phone users.
Dawn Baron, Chairman of the Independent Traders in the town, said: “It is a great thing especially for people that want to pop in for a prescription or a loaf of bread and who knows they may see something else they want while they are out.
“People are more likely to pop in if they don’t have to pay for car parking and the more people we can encourage into the town centre will add to a better atmosphere.”
The free hour parking is part of the council’s car parking strategy, which plans to increase the number of spaces available in Gainsborough by 43 per cent over the next two years.
Also with immediate effect, car parking permits are now back on sale – to purchase one contact Customer Services on 01427 676676 or call into the Guildhall at Marshall’s Yard.
The council's car parking strategy aims to deliver 30 new spaces in the Roseway Car Park by September, and a further 140 car parking spaces across the town as the town centre develops from 2020
The authority has bought the former Lidl site overlooking the River Trent. In the short-term part of it has been turned into a pay and display car park and has been renamed Riverside Car Park.
Coun Young added: “I often receive comments from local residents about the lack of short stay car parking provision in the town and I hope the Riverside Car Park will go some way to alleviate this.
“The council has restricted permit holders as to where they can park, they are not permitted to park at Roseway Car Park and Ship Court car park in the town. This decision was taken to encourage short stay visitors’ access to car parks closer to the town centre to access shops, banks and pharmacies.
“I would urge more able residents to think about where they park and to use the new Riverside Car Park, North Street or Bridge Street car parks to encourage a high turnover of use in the car parks closer to the town and support local businesses.”