The Board of Trustees at Waitaki Boys High School is to be dismissed and a Commissioner appointed in its place.
The decision by the Ministry of Education follows reports into the school which found serious governance and management issues at the 500-student Oamaru school.
The first report pointed to significant staff turnover, division among teaching staff and a culture of bullying.
Ministry of Education deputy secretary Katrina Casey said a second report showed nothing had changed.
"It's talking about a management style that is characterised by fear and favour, it's expressed concerns about the senior management team of the school and certainly what we would be expecting to see is a change in behaviour and attitude."
Ms Casey said the board had been given time to restore confidence in the school, but had failed to do so.
"What you start to see is a whole lot of things start to unravel and of course from everybody's perspective this has to be about the kids, and we have to sometimes step aside the adults so that the kids can get the best education that they should get."
The board was told of the decision last night and agreed to stand down.
One of the authors of the second report, former Waitaki mayor Alan McLay, said he felt he had no option but to pull the carpet out from under the board once he began investigating the school.
Ms Casey said the Commissioner would be named next week.