Half the cost of a new road junction in Oxfordshire will be funded by central government.
Two new south-facing slip roads will be built at Abingdon's Lodge Hill junction on the A34, in an area where 1,700 new homes are planned.
The scheme will receive about £9.45m over four years from the government.
The total cost of the project is £18m, with the rest of the funds coming from developers and The Oxfordshire Local Enterprise Partnership.
Ian Hudspeth, leader of Oxfordshire County Council, said: "The delivery of much needed housing in and around Abingdon is heavily reliant on funding for new slips at Lodge Hill.
"Residents have been concerned that large numbers of houses will be built before the necessary highway infrastructure is in place.
"This announcement means that vital infrastructure will be built at the early phase of development to cope with the associated additional traffic."
Communities Secretary Sajid Javid said: "Most people are willing to accept new housing in their areas, but they don't want to see massive development when local roads are already under pressure."
A start date for the scheme is yet to be announced.