Australia will purchase 58 more F-35 Joint Strike Fighters at a cost of Aus$12.4 billion ($11.6 billion) in a major upgrade to defence capabilities, the government said.
The new aircraft will bring Australia's total JSF force to 72 aircraft, with the first due to arrive in Australia in 2018 and enter service in 2020.
"The F-35 will provide a major boost to the Australian Defence Force's intelligence, surveillance and reconnaissance capabilities," Prime Minister Tony Abbott said in a statement released late Tuesday.
"The fifth generation F-35 is the most advanced fighter in production anywhere in the world and will make a vital contribution to our national security."
The deal with US aerospace giant Lockheed Martin is in addition to 14 F-35s Australia already approved in 2009.
"The acquisition of F-35 aircraft will bring significant economic benefits to Australia, including regional areas and local defence industry," Abbott added.
The government, which was to make a detailed announcement on the deal later Wednesday, will also consider an option to buy another squadron of F-35s to replace the air force's fleet of ageing F/A-18 Super Hornets which are due for retirement from 2022.
The overall price tag includes weapons, spare parts and maintenance facilities, with Australia's defence industry reportedly set to benefit by up to Aus$1.5 billion in flow-on business.
The fighter programme will see Aus$1.6 billion spet on upgrading air force bases at Williamtown in New South Wales and Tindal in the Northern Territory where the planes will be based.
Australia had originally indicated it would buy 100 of the jets, and that is still a target figure for air force chiefs, but budgetary constraints under the previous government saw it trim back and delay the order in 2012.
The JSF, costing US$160 million each on Pentagon figures and not due to enter service until 2016, has been touted as a technological wonder and the ultimate stealth attack plane able to evade radar detection.
However it has suffered setback after setback and is seven years behind schedule with a budget blow out of US$167 billion dollars to more than $390 billion, making it the costliest weapons programme in US history.
South Korea has plans to finalise the purchase of 40 F-35 jet fightersfrom Lockheed Martin later this year.
Australia is one of eight countries, apart from the United States, taking part in the JSF programme: Britain, Canada, Denmark, Italy, the Netherlands, Norway and Turkey