The Ministry of Defence (MOD) has confirmed plans to start marketing RAF Scampton for sale by the end of December 2022.
It was confirmed in 2018 that Scampton would be shut and sold as part of cost-cutting measures to save £3 billion by 2040.
Jeremy Quin, Minister for Defence Procurement, said in a letter to Sir Edward Leigh, the Conservative MP for Gainsborough, his staff had been working with the local council to deliver "the future for the RAF Scampton site that provides the greatest benefit for the local community".
Mr Quin also said that he was "encouraged" to hear there was a plan under consideration that "utilises the whole site".
"Subject to the satisfactory completion of the necessary site closure work, we anticipate marketing of the site could commence by the end of December 2022," he said.
Mr Quin added that the ability of the Red Arrows to continue training in the airspace above RAF Scampton is dependent on the "scale and nature" of the development at the base.
"The RAF will continue to use the airspace above the site while that remains possible," he said.
However, if they cannot continue training above RAF Scampton, Mr Quin said the Royal Air Force will have to work with the Civil Aviation Authority (CAA) to find airspace above Lincolnshire from the Red Arrows' new home base at RAF Waddington.
"I am assured by my RAF colleagues that such a resolution is realistically achievable," Mr Quin said.
The Red Arrows' new home at RAF Waddington in Lincolnshire is about 10 miles from RAF Scampton.
The Royal Air Force aerobatic display team began a period of temporarily flying out of Waddington last year, in preparation for when the move becomes permanent.
The selection of the base as the Red Arrows' new home came after a petition, with more than 11,000 signatures, was presented to the Government to keep the Red Arrows in Lincolnshire.
Meanwhile, a group of campaigners is hoping to turn RAF Scampton, where the 'Dambusters' Squadron launched its raids from in the Second World War, into a heritage site.
Watch: Every move from the Red Arrows' 2021 display season.