US hotel company Starwood has become the first American firm to agree a deal with the Cuban authorities since the revolution of 1959.
Starwood will renovate and run three hotels in the Cuban capital, Havana.
A spokesman for the company said they would be making a "multimillion-dollar investment to bring the hotels up to our standards".
The news comes on the eve of President Obama's visit to the island - the first by a US president in almost 90 years.
The BBC's Will Grant, in Havana, says the deal is a welcome reminder of how far things have come between the two nations since they decided to normalise ties.
With this visit, and such economic steps, the two sides hope the new ties will soon be irreversible, our correspondent adds.
Tourism in Cuba is at an all-time high, including a sharp rise in the number of US visitors, especially since travel restrictions were eased by President Obama.
Starwood is currently the target of potentially the biggest takeover of an American company by a Chinese business.
Anbang Insurance, which already owns New York's Waldorf Astoria, has made a $13bn bid for Starwood, trumping an offer by America's Marriott International.
Anbang's founder, chairman and chief executive Wu Xiaohui is married to Zhuo Ran, grand-daughter of Deng Xiaoping, the country's former leader who is credited with engineering China's economic reform.
Thaw in US-Cuba relations:
- US-Cuba relations were frozen since the early 1960s, when the US broke off diplomatic relations and imposed a trade embargo after Cuba's revolution led to communism.
- The embargo was estimated to cost the US economy $1.2bn a year.
- US President Barack Obama announced moves to normalise diplomatic and economic ties in December 2014.
- It followed more than a year of secret talks in Canada and at the Vatican, directly involving Pope Francis.
- The plans included reviewing the designation of Cuba as a state sponsor of terrorism, easing a travel ban for US citizens, easing financial restrictions, increasing telecommunications links as well as efforts to lift the trade embargo.
- The US reopened its embassy in Havana in August 2015, a month after Cuba reopened its embassy in Washington.