Hundreds of jobs in Somerset are to be secured due to a new government order for 62 Future Lynx helicopters from Agusta Westland, BBC West has learned.
The Secretary of State for Defence, John Hutton, will confirm the order for the Yeovil production site on Thursday.
An immediate contract will also be awarded to upgrade existing Lynx helicopters to prepare them for battlefield sites such as Afghanistan.
The order, worth £1bn, has been delayed for more than two years.
The new helicopters will be for the army and navy and the news has come as a relief to the local community.
'Really good news'
Liberal Democrat Councillor Tim Carroll, leader of South Somerset Council, said: "It's really, really good news - especially in times we have at the moment.
"We've lived with the uncertainty over the last year and we're just very, very pleased for the local economy of Yeovil and South Somerset that the order has been confirmed."
The order was originally for 70 helicopters but has been reduced to 62.
Shadow defence secretary, Liam Fox MP, said a 10% reduction in the original order called into question the government's priorities at a time when the armed forces were crying out for more helicopters.
But David Laws, Liberal Democrat MP for Yeovil, said: "That is the best possible Christmas present, not only for Agusta Westland and also the economy in Yeovil, but also the armed forces who desperately need these very important helicopters."
Meanwhile Mr Hutton is due to issue a written ministerial statement on the future of two new Royal Navy aircraft carriers - HMS Queen Elizabeth and HMS Prince of Wales.
Reports suggest he could delay their entry into service - scheduled for 2014 and 2016 - by two years as the Ministry of Defence tries to cut costs.
Work on the £4bn project had been due to begin next spring.