The broadcasters said the service, called BritBox, would be home to the biggest collection of British boxsets and original series on any streaming platform, featuring “old favourites”, recent shows and brand new commissions.
They said that talks for the service, which has long been rumoured, are “in the concluding phase”, and it is expected other broadcasters could also join.
ITV chief executive Carolyn McCall said: “BritBox will be the home for the best of British creativity – celebrating the best of the past, the best of today and investing in new British originated content in the future.”
BBC Director-General Tony Hall said the streaming service would be “truly special”.
“A new streaming service delivering the best home-grown content to the public who love it best,” he said.
“The service will have everything from old favourites to recent shows and brand new commissions. It’s an exciting time for the viewing public.”
The service is expected to launch in the second half of the year.
The BBC and ITV are yet to announce how much subscribers will have to pay, but prices have been described as “competitive”.
They have already enjoyed success with the service in North America, where it has gathered half a million subscribers.
The broadcasters will now discuss the plans with regulator Ofcom, who said they “want to see broadcasters collaborating to keep pace with global players, offering quality UK content that’s available to viewers whenever and however they want to watch it.”
Those interested in subscribing to BritBox when it becomes available can do so now at www.britbox.co.uk.