London-based Trinity College of Music and the Laban dance centre are to merge, giving students from the two disciplines the opportunity to collaborate.
Under merger plans, the two institutions will retain their names but will have a single principal, Gavin Henderson, and a single board of governors.
The merger is due to be completed by August 1 2004, with the backing of the Higher Education Funding Council for England.
Trinity College is based in the Old Royal Naval College in Greenwich, while Laban is just half a mile away in Deptford Creekside.
Derek Aviss, director-designate of Trinity College, said: "There is no college of music and dance in the whole country. We are training our musicians alongside dance performers. We will be a significant force on the scene."
Anthony Bowne, director-designate of Laban, named after a Hungarian dancer and choreographer, said: "We are trying to do something that is bigger than the sum of our parts. In addition to being top of our fields in music and dance, we will work together.
"The collaboration between dance and music is particularly rich. We are very excited about building joint courses in choreography and composition."
Between them, the institutions will have about 700 students.
* This week, Laban won the Royal Institute of British Architects' building of the year award for its premises, designed by Herzog and de Meuron.