The emergence of a charge density wave (CDW) in transition-metal dichalcogenides opens up a route to charge order, followed by superconductivity at low temperatures. A key question here concerns how many particle electron–electron interations govern the low-energy electronic structure in the normal and CDW states. Using dynamical mean-field theory, we explore the many-body properties of an extended, two-band Hubbard model applicable to 2H-TaSe2. We reveal the electronic structure reconstruction in the normal and CDW states driven by two-band dynamical correlations. Our results demonstrate a remarkable renormalization of the Ta-5d bands crossing the Fermi level, showing a continuous reduction in the CDW gap up to an incomplete gapping, followed by a CDW to a CDW–Mott phase transition pertinent to strongly correlated transition-metal dichalcogenides.