Police will excavate a site near Granton, beside the Lyell Highway, in response to new information about Ms Butterworth's disappearance on August 25, 1969.

Ms Butterworth was last seen at Claremont where she was waiting for a New Norfolk-bound bus.

The information has been provided to the coroner and relates to a man who remains a person of interest in Ms Butterworth's disappearance.

Detective Inspector David Plumpton said that Ms Butterworth's family deserved to know what happened.

"Her brothers have lived for 46 years not knowing where she is or how she died," Detective Inspector Plumpton said.

"We're determined to do all we can to bring them some understanding of what happened.

"We also hope that this operation, together with the forthcoming coronial inquest, will prompt someone else with knowledge or memories of the events that night to come forward and talk to us. It's never too late."

The excavation is set to begin early next week and could take several weeks.

A coronial inquest into Ms Butterworth's murder is scheduled to start on August 31.

Lucille Butterworth’s disappearance is one of the most enduring mysteries in Tasmania’s criminal history.

The 20-year-old typist was on her way to a Miss Tasmania Quest fundraising meeting at New Norfolk when she was last seen at the bus stop in Claremont.

Her boyfriend, John Fitzgerald, came from New Norfolk and was waiting at the other end.

The couple had planned to marry but had not yet announced their engagement.

Coroner Simon Cooper told the formal start of the inquest in May that there were four persons of interest in the Butterworth case, with three still alive almost 46 years on.

In 2014, police arrested a man and questioned him for four hours about the disappearance but released him without charge.