A £1.1bn City Deal for Edinburgh and south-east Scotland was signed yesterday.
As part of the agreement, both the UK and Scottish Government will invest £600m into the region over the next 15 years while regional partners have committed to investing £500m.
The funding will help create world-leading data innovation centres, and will also deliver key infrastructure and housing developments, creating up to 21,000 new jobs.
City council leader Adam McVey, speaking on behalf of the six local authority partners, said: ‘The significant investment in innovation and culture is to be welcomed as they are both hugely important to the region’s economy.
‘This will put us at the forefront of data-driven innovation, ensuring we are ahead of the game in a technology-driven world.’
Professor Sir Timothy O'Shea, principal of the University of Edinburgh, added: ‘Our research in new data technologies and the skills of our graduates have helped establish Edinburgh over the last decade as one of the main centres of the digital economy in the UK.
‘The City Deal provides the impetus to move to the next level: a transformational programme of data-driven innovation which will harness the power of data technologies across the economy - from healthcare to agriculture, robotics, public services, finance and the creative industries - and equip many more of our young people from all backgrounds to succeed in the digital economy.’
The agreement will also provide £20m capital funding for a new concert hall and £25m for a regional skills programme.