Springhill sent out a news release Tuesday saying an application has been sent to the Nova Scotia Utility Review Board for dissolution of the town.
Council says a transition co-ordinator will be appointed and will guide discussions on joining the nearby municipality of Cumberland County.
The release says the decision is related to the town's struggling financial situation, adding many small Nova Scotia communities are facing similar challenges.
The changeover is scheduled to happen on April 1, 2015.
The minister responsible for Municipal Relations says the province will assist in negotiations and the appointment of a transition co-ordinator.
Tory Leader Jamie Baillie, who is the member of the legislature for the community, says he expects the province will consider the interests of the town in the application to the provincial regulator.
"I expect Springhill residents will be provided with an opportunity for input," he said in a news release.
"In the end, I know that no matter what happens, Springhill will always be Springhill."