The city of Iga in the Mie Prefecture has said it will be issuing partnership certificates to same-sex couples from April.
The decision, that was announced at a meeting of the assembly on Tuesday, makes the region the third in Japan and first outside of Tokyo to take such a step.
Municipal officers have said they hope the move will help to reduce discrimination and ensure people in relationships have their rights protected.
Last year, the mayor of the ward, Sakae Okamoto, said he planned to bring forward the certificates, but had instructed officials to investigate the best way of going forward.
“We were aware of the statistics showing that 7.6% of Japan’s population identify as gay, lesbian, bisexual or transgender,” a municipal official said on Wednesday.
“We concluded that if the figures are reflected here, presumably hovering around 5 to 7%, we need to do our utmost to protect the rights of such minorities.”
He added that because Shibuya and Setagaya wards in Tokyo have already taken such steps, it inspired them to follow suit.
Although these certificates are not legally binding, businesses and hospitals are being asked to honour them in the same way they would a marriage licence.
Officials have said in order for couples to be eligible, both partners have to be at least 20-years-old and reside in the city.
The will also be required to submit evidence that they are single and sign a written declaration.
Shibuya ward became the first municipality in Japan to recognise same-sex unions in March 2015 and said they would publicly name any business who failed to recognise the relationships.
The ward of Setagaya followed suit shortly after and said the partnerships would regarded as equivalent to marriage.
Both wards started issuing certificates in November last year.
Recent polls in Japan have shown that a majority of people are in favour of marriage equality.