The Berkshire track has announced the Grade Two novice chase on December 2 formerly known as the Worcester Novices' Chase will be run as the Ladbrokes John Francome Novices' Chase.
Francome's name will be permanently attached to the race, which has been won in the past two years by Colin Tizzard-trained stars Thistlecrack (2016) and Native River (2015).
Francome, who claimed two Hennessy Gold Cups at the course on Brown Chamberlin (1983) and Burrough Hill Lad (1984), said: "Newbury is not only my local track, it is also my favourite and I am honoured to have a race named after me, especially one which has produced such outstanding winners for the past two years.
"You normally have to die before anything like this happens, so I hope they don't know something more than I do and that I am here to see the next winner!"
Ladbrokes have taken over sponsorship of the Hennessy, which has been renamed the Ladbrokes Trophy.
Mike Dillon, PR director at Ladbrokes, said: "This is a thoroughly deserved and appropriate accolade for one of the greats of the sport.
"Everyone has their own favourite 'Francome moment', but for me the sportsmanship he displayed in 1981/82 when he stopped riding towards the end of the season having drawn level with Peter Scudamore so that they shared the champion jockey title sums up the man perfectly."
Andy Clifton, head of communications at Newbury, said: "The word legend is overused these days, but it almost seems inadequate when one thinks about the positive impact that John Francome has had on the sport of horse racing over many years, in lots of different ways.
"As someone who has lived in the area his entire life and had so many successes as a jockey at Newbury, we are thrilled to be able to name a race after him at his local track on our biggest day of jump racing."