Pubs, bars and casinos will be shut down as part of the shift which sees the county join the nearby Liverpool city region in the highest bracket of restrictions.
Different households will not continue not being allowed to mix in homes or private gardens.
But in a significant difference with Merseyside, gyms and leisure centres will be allowed to stay open.
The county is said to have also secured £42m out of the £58m it was seeking in financial support for businesses, the care sector and schools.
Geoff Driver, leader of Lancashire County Council, confirmed the figure to the BBC.
But there was immediate confusion about the amount after the government released a statement saying the support package would be just £12 million – the figure it initially offered at the start of negotiations.
In that statement, health secretary Matt Hancock said: “I know how heavy these additional challenges will weigh on everyday life for the people of Lancashire – but they are critical in bringing this virus under control.
“Without them, we risk the health of your loved ones, your most vulnerable, and your local NHS services. Now is the time to play your part, and we will make sure you are supported.”
Responding to the agreement, David Morris, conservative MP for Morecambe and Lunesdale, said it was right the government should up its economic offer before imposing the new measures.
“No-one is happy about these restrictions having to be implemented – not politicians or the public – but we have to deal with the reality of rising virus numbers,” he told The Independent. “Action does need to be taken because we are trying to contain a killer virus and the evidence shows that one of the biggest ways this spreads is through pubs.
“The government has improved its offer of financial support for the area and it was the right thing to do to agree to that. The economic consequences of not doing this and allowing further spread of the virus would be far worse.”
Greater test and trace support has been offered to the county, as well as a specific ministerial team to deal with new outbreaks there.
The agreement – which will come into place at a minute past midnight on Saturday – comes as infection rates in Lancashire continue to surge.
Government figures released on Friday morning showed that for those aged 16-29 in the county positive cases were now at 552 per 100,000 people, while in the most vulnerable age group, those aged over 60, cases stand at 214 per 100,000 people.
Speaking just hours before the new measures were announced, foreign secretary Dominic Raab had warned that ministers would not be “held over a barrel” by local leaders when it came to restrictions.
He made his comments after Andy Burnham, mayor of Greater Manchester, said his region would not be moved into tier three without greater financial support from central government.
The north, he said, was being treated like a “canary in the coalmine” and that the still untested-restrictions would devastate the region without greater help economic help.
The deal means that a further 1.2 million people – including residents in Blackpool, Burnley and Preston – now join the 1.6 million in the Liverpool City region in finding themselves in England’s severest restrictions.
The new tier system sees every area of England classed as being on medium, high or very high alert – also known as tiers one, two and three.
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