A new 12-kilometer green belt along the section of Huangpu River in Yangpu District in the city's east will be China's version of Vancouver's Stanley Park, according to a designer of the project.
The project called "Yangpu Forest" will be built by 2010.
The area will also incorporate some of the nation's oldest industrial buildings as a showcase of "industrial civilization."
"Combining nature with industrial heritage means the site will become a new side area during World Expo 2010," said Chang Qing, head of the Architecture Department of Tongji University, who leads the designing panel of the project.
Once complete, Chang said the area will resemble the four-square-kilometer Stanley Park, which is one of the main reasons why Vancouver has won the title as the world's most livable city.
The planned forest belt, 300 meters wide and covering 8.25 square kilometers, will start at the Gongqing Forest Park in the north, and wind through Yangpu District to the south end of Qinhuangdao Road.
The government will break the walls of the Gongqing Park and incorporate it into the forest.
A statue of the Goddess of Peace will be built beside the river near Fuxing Island as a symbolic water entrance into Shanghai.
The riverside section of Yangpu District is called East Bund by local planners. Yangpu became the city's first industrial area in the late 1880s due to its access to water for transport and cheap land.
The first waterworks, mechanized cotton mill and steel workshop were built in the area.
"We will conserve most of the existing industrial heritages and give them modern functions such as museums and studios," Chang said.
The industrial buildings to be kept include the Yangshupu Waterworks built in 1883, Ewo Cotton Mill built in 1911 and the No. 1 Boiler Room of Riverside Power Station built in 1913.
Along with the forest, a mix of modern communities, research institutes and hotels will be built.
"The renovation of the East Bund area will reflect the theme for World Expo 2010 - Better City, Better Life," said Wu Jiang, deputy director of the Shanghai Urban Planning Administrative Bureau.