The service will be called the Amazon Kindle Lending Library and, unlike a traditional library, will actually cost you a membership fee. You'll need to pay for Amazon Prime membership at £49 a year... and buy a Kindle, naturally.
Launching in late October, the Kindle Lending Library will feature over 200,000 books (including - Amazon reliably tells us - all seven Harry Potter books!) that you can "borrow" for free. You'll only be allowed to borrow one at a time, mind.
If you haven't got a Kindle yet, then this could be a further nudge towards Amazon's all-conquering device. Coincedentally, the online retailer is also launching its new Amazon Kindle Paperwhite later this month on October 25th.