Barcelona's board of directors have rejected the option of building a new stadium and will push ahead with a remodelling of the Nou Camp, president Sandro Rosell said.
Barca members, who collectively own the Catalan club, will be given a chance at the beginning of April to vote on the proposal that would increase the capacity of Europe's biggest stadium from 98,000 to 105,000 and help boost matchday revenue, Rosell told a news conference.
The project, which also includes the construction of a new indoor basketball arena and various other installations, is expected to cost around $814m and work would begin in 2017 and be completed by early 2021.
Matches would still be played while the work, which would see a striking new roof added to the current structure, is carried out.
"It was a difficult decision," Rosell said. "The two projects were very attractive but we were committed to put to a referendum a project that was viable from a technical, urban-planning and economic perspective.
"The Nou Camp is part of our collective memory, the biggest stadium in Europe and an icon of the city of Barcelona.
"The option of building a new stadium on a new site has been rejected as the final cost could have saddled the club and its members with debt and tied the hands of future boards of directors."
The plans for the remodelled stadium, which opened in 1957, include building a steeper bottom tier that would improve visibility for spectators. There would be new restaurants with a view of the pitch and so-called 'super boxes' and other VIP services.