Under the changes, Sky Sports News will become Sky3+1 on Freeview and offer an hour timeshift of the already available Sky3 channel.
From that point, Sky Sports News will only be available on Sky, Virgin Media and TalkTalk TV, along with Sky's online and mobile platforms.
Sky said that changing Sky Sports News to an exclusively pay-TV channel is about "allowing it to benefit from continued growth in subscription revenues".
Later in the year, the satellite broadcaster also plans to launch Sky Sports News HD, which will become the fifth HD channel in the Sky Sports bouquet. More details about the channel will be announced in "the weeks ahead".
Alongside the channel developments, Sky also plans to build on the "existing success" of Sky Sports News with increased editorial investment.
The extra financial support will help "bring customers even richer and broader coverage of sports news, as well as faster reaction to breaking stories wherever they happen".
Sky Sports managing director Barney Francis said: "Sky Sports News has been a great success over the last 12 years and we have big ambitions to make it even better.
"As part of a subscription service, customers can look forward to expanded coverage and the launch of Europe's first HD sports news service."
Last month, it emerged that Sky News had initiated plans to streamline its sports reporting team to foster greater collaboration with the Sky Sports News operation.