It is part of a nationwide programme that will see the Government invest around £2 billion a year over the next six years. In the West Midlands, state funding of £774 million – £163.3m in the first year alone – will help create 40,000 jobs and 13,000 homes.
It will also pay for thousands of training places and a string of transport projects, many tied in to the High Speed 2 rail scheme.
Money will also be used to revamp and extend Wolverhampton's Civic Halls and improve the city's Grand Theatre.
Staffordshire today also won an £82.2 million Government investment to create 5,000 jobs, build 1,000 homes and train-up skilled workers.
As part of the huge cash investment a new highway will be built to the west of Stafford and four massive job creation sites will be opened up for development.
David Cameron declared the deal an 'historic day' and said: "The Black Country is set to cement its standing as a hub of high-value manufacturing – so 'Made in the Black Country, Sold Around the World' isn't just a slogan, it's a reality."
The Government is to pump £138.7m into schemes locally over the next five years, which are expected to generate another £310 million in public and private investment.
Of 16 projects submitted for approval in April, the Government is backing 14, with £35m being spent in the Black Country next year alone. Over five years the money is expected to create new jobs and homes while 3,200 businesses will be helped to grow and 7,000 people will be trained in workplace skills.
The deal has been sealed between the Government and the Black Country Local Enterprise Partnership, the body made up of local business chiefs and the heads of councils in Dudley, Sandwell, Walsall and Wolverhampton.
New wider bridges will be built over the M6 at Junction 10, increasing the amount of traffic that can be handled on the roundabout.
A new Advanced Centre for Advanced Building Technologies and Construction at Dudley College will be created. In particular it will give people the training to take up the construction jobs likely to be generated by the HS2 railway project.
New office accommodation and increased parking will be created at Wolverhampton railway station.
The money granted to Staffordshire, meanwhile, will pay for thousands of training places and a string of transport projects, many tied in to the High Speed 2 rail scheme. One of the biggest railway projects will be the Mid-Cannock road/rail freight interchange. This will see construction works on the Chase Line and the Mid-Cannock container depot to create new road-rail interchange facility with rail sidings and container handling cranes.
In its deal with the Stoke-on-Trent and Staffordshire Local Enterprise Partnership – the body made up of local council chiefs and business bosses – the Government is promising £20.9m from April next year, followed by £61.3m over the next four years.
At Stafford money will go towards a new Western Access highway, between Newport Road and Doxey Road, which is intended to ease congestion in the county town and help open up sites for housing and so companies can expand and create jobs. It means the completion of a long-awaited road link.
At the same time four key employment areas across the country will be opened up, including Berricote at Four Ashes, Lichfield Park, Meaford near Stone and Etruria Valley in Stoke.
The Lichfield Park scheme will involve bridge widening and local road improvements in Lichfield to improve access to the Cappers Lane employment area and the Lichfield Park employment site.
At Meaford, Stone, a new roundabout junction on the A34 will improve access to the Meaford employment site.
At Berricote Four Ashes, in South Staffordshire, new traffic controlled access and road widening for the Berricote Four Ashes employment site.
Prime Minister David Cameron said: "This historic deal means real change with exciting plans for Stoke-on-Trent and Staffordshire."