The dangerous Horrocks Highway in the Mid North will be upgraded at a cost of $40 million.
The spending was unveiled in a federally-funded, multi-million-dollar package of roadwork around South Australia.
Total cost of the Horrocks upgrade is $55 million in partnership with the state government.
Federal Grey MP Rowan Ramsey said he was happy that the country would benefit from the "accelerated projects".
"The federal government will deliver $80 million toward the South Australia Rural Roads Safety Package immediately in the next two financial years including money for the Horrocks Highway, out of its commitment of about $114 million," he said.
"Having the support of state Transport Minister Stephan Knoll in bringing forward these works has been essential.
"With the state and federal governments working together, it is generating outcomes.
"In this case, the Horrocks Highway, the notorious road linking the wine grape growing region of the Clare Valley with the state's capital city, is set to be rejuvenated with funding in the Federal Budget. "The highway carries increasing loads of tourists into one of the most beautiful parts of the state, but it is also a major freight route and we need to make sure it is both safe and efficient for both of these groups to use."
Mr Ramsey said the package was part of a 2019-20 Budget commitment of about $260 million to SA rural roads.
He said it would tackle such problems as a lack of overtaking opportunities, poor shoulder sealing and pavement condition and dangerous intersections.
"We are bringing forward funding of about $87 million from our $125 million commitment for widening, strengthening and realignment works along the Eyre Highway that will improve freight efficiency, making regional SA businesses more competitive," he said.
Under the package, councils will be able to bring forward their priority projects for accelerated funding.
Transport Minister Mr Knoll said his government would spend another $20 million out of its commitment of about $29 million to make the package a reality.
"By working with the federal government, we have fast-tracked some road projects to help build regional communities, improve road safety and save lives on our country roads," he said.
"We have also released an $18 million tender package of works to improve road safety in the Mid North and Yorke and Eyre Peninsulas.
He said investment in country roads had been greatly needed.
The federal government will contribute $100 million toward the $125 million Port Augusta-Perth upgrade.