Carrington Parish Council will now be known as Carrington and New Bolingbroke Town Council more than 30 years after the two parishes originally merged.
The parish voted last November to enact the plan, and the formal request was approved at a recent meeting of East Lindsey District Council.
Lincolnshire County and East Lindsey District Councillor Tom Ashton, whose ward covers the Carrington and New Bolingbroke area, explained that the latter was founded 200 years ago with the intention of becoming a market town.
It aimed to exploit its position half way between Horncastle and Boston, and its access to navigable drains for trade and transport.
However, railways built elsewhere in Lincolnshire stalled growth, leaving the area with a core of ‘town’ buildings but not much else.
More than 30 years ago, Carrington and New Bolingbroke parishes merged under the ‘Carrington’ name.
Councillor Ashton said: “It is a fitting touch that the village with a Town Hall and a Town End Farm shall now have a Town Council too, and the ambitions of its founders will be partially fulfilled at long last.”