The Japanese town made infamous by the Oscar-winning documentary The Cove will open a marine park where visitors can swim with dolphins, but officials said its annual slaughter of the creatures will continue in a nearby bay.
Unrepentant organisers say they want tourists to be able to eat dolphin and whale meat as they watch the captive animals frolic.
The town of Taiji has begun researching a plan to section off part of a cove and turn it into a place where people can swim in the water and kayak alongside small whales and dolphins, Masaki Wada said.
But, the local government official insisted, far from having caved in to pressure from conservationists who want an end to a yearly hunt that turns waters red with blood, the project was aimed at helping to sustain the practice.
"We already use dolphins and small whales as a source of tourism in the cove where dolphin-hunting takes place," he said.
"In summer swimmers can enjoy watching the mammals that are released from a partitioned-off space.
"But we plan to do it on a larger scale. This is part of Taiji's long-term plan of making the whole town a park, where you can enjoy watching marine mammals while tasting various marine products, including whale and dolphin meat," he said.
The park will be separate from Hatakejiri Bay, the place into which the fishermen of Taiji corral dolphins, select a few dozen for sale to aquariums and marine parks and stab the rest to death for meat.
The plan calls for the creation of a whale safari park stretching roughly 28 hectares by putting up a net at the entrance to Moriura Bay in northwestern Taiji, the official said.
The 2009 film The Cove brought Taiji to worldwide attention, winning an Oscar the following year, after graphically showing the killing of dozens of trapped animals, including by using underwater cameras. Activists continue to visit the town to protest against the hunt.
Taiji, in western Wakayama prefecture, is looking to open part of the park within five years, Wada said.
Wakayama prefecture said the town caught 1,277 dolphins in 2012 and has licence to capture 2,026 this season, which began in September and runs until August next year.
Tokyo-based conservationist group Iruka & Kujira (Dolphin & Whale) Action Network (Ikan) said the plan was unfortunate for the town.
"The whole plan is based on the concept that they can exploit dolphins and whales freely as their resource, but the mammals don't belong to Taiji," said Nanami Kurasawa, the Ikan secretary general.
People in Taiji argue that dolphin-hunting is part of a 400-year-old whaling and culinary tradition. They charge that campaigns against it are cultural imperialism that neglects the parallels between killing dolphins and killing cattle.
Japan regularly draws international ire for its annual whale hunt in the Antarctic. Tokyo defends the practice as legal "scientific research", a byproduct of which is the meat that ends up on dinner tables back home. Critics say the research is a pretext for a hunt that is underwritten by taxpayers' money.