The B5605 Newbridge Road road between Cefn Mawr and Chirk has been shut for more than a year since a landslip happened during severe storms last year.
The road links Newbridge and Cefn, Chirk, and Plas Madoc/Ruabon to the north and was badly damaged by Storm Christoph, with long diversions in place ever since.
Ministers from the Welsh Government have now confirmed funding to repair and reopen the road.
The Government had already awarded Wrexham Council £175,000 for "ground investigation and detailed design of remedial works"
Ken Skates, Member of the Welsh Senedd for Clwyd South, welcomed the news alongside local campaigners Frank Hemmings and Derek Wright.
He said: “I’m thrilled that the Welsh Labour Government has approved Wrexham’s bid for further major funding to resolve this issue. It’s caused major problems locally, and a great deal of frustration, but after thorough and necessary investigations this is the news we wanted.
Mr Hemmings said: “This is fantastic news for people in Chirk and further afield. This has been a huge headache for local people and has caused a lot of disruption and inconvenience, and I’m really grateful to the Welsh Government for approving the council’s funding application.
“As a B-road it’s actually the council’s responsibility to repair it, but given the level of funding needed we were reliant on the Welsh Government. I’m delighted they have delivered for our area.”
Mr Wright said: “The road is a vital link between our communities and the closure has left some people, particularly those without their own transport, cut off. We have been on and on about this to Ken, and I know he’s been doing the same with Welsh Government.
“This is a massive win for our area and I’m really pleased the repairs can now go ahead.”