Leeds City Council has agreed to broker a £35m deal with a private investor to redevelop Headingley rugby and cricket stadiums.
The sporting complex hosts cricket, rugby league and rugby union fixtures.
Council leader Judith Blake said the deal would secure top-level international matches at Headingley.
As part of the deal, the council would lease the ground from the investor and sub-let it to Yorkshire County Cricket Club and Leeds Rhinos.
Leeds Rhinos has also pledged £5m toward the cost of the redevelopment.
The council had withdrawn a £4m grant from the work, leaving Yorkshire County Cricket Club facing being unable to host international matches after 2019.
However, Ms Blake said this was the best solution for all parties.
“When you take into account the significant economic benefits top-class rugby and cricket matches bring to the city and region, we could not stand by and do nothing to protect its international sporting status,” she said.
She added the full cost of the redevelopment would be met by the clubs as part of the lease deal.
Headingley consists of a cricket stadium and rugby ground, with a shared two-sided stand linking the facilities.
The plan includes a new south stand on the rugby ground and a replacement shared stand.
The deal, which was approved earlier by the council’s executive board, is due to get final approval in June, with work starting in September.