The Reds' ownership have taken the historic decision in recognition of the special status the Scot holds both at the club and within the city itself.
Dalglish not only represented Liverpool as a player with distinction – and is regarded by many as the greatest to have ever donned the jersey – but also as a highly successful manager.
In tribute, the Kenny Dalglish Stand will now sit alongside the Kop, Main Stand and Anfield Road at Anfield.
Scroll through our gallery below to take a look at some iconic and memorable images of the 66-year-old from over the last four decades…