Contractors have been appointed for the scheme from the M25 to Crawley.
The move allows the hard shoulder to be used on the motorway which carries more than 120,000 vehicles each day, Highways England said.
But the AA has raised concerns and said the "jury is still out" on smart motorways which use technology to control traffic.
The M23 scheme is expected to cost between £148.4m and £211.2m, creating a four-lane stretch from a three-lane section.
Highways England said other smart motorways had a good safety record and officers could respond quickly if people did break down in a live lane.
The spokesman said "environmentally-sound" smart motorways also cost less than widening schemes and they used less land.
But Paul Watters, from the AA, said smart motorways needed to be evaluated after a reasonably long period.
He claimed the Surrey/Sussex scheme would be "permanent all-lane running", meaning four lanes would in operation all the time, and he added: "We need to see how we're faring with those."
Mr Watters added there had been reports of drivers continuing on closed lanes, and surveys had shown people still did not fully understand smart motorways.
He said the scheme was justified because traffic was increasing and the M23 served both Gatwick and the M25, but the AA had concerns about using the hard shoulder - leaving no spare capacity for the future - and about the distance between refuge areas.
A smart motorway scheme is to be built on the M23 in Surrey and West Sussex at a cost of up to £211m.