The investment has come in anticipation of a major surge in interest in the sport ahead of the 2022 Commonwealth Games in Birmingham.
The council-owned athletics track, in Oakengates, is home to Telford Athletics Club and is about 30 miles from Birmingham, which will welcome about 6,500 athletes and officials for the games in the summer of 2022.
Telford & Wrekin Council said it is committed to exploring how the borough can get involved, including possibly providing facilities for athletes and officials to use.
The £100,000 funding will be spent on upgrading the track, which is regularly used for regional and national athletics events.
Upgrades will include some track resurfacing which has now begun with an estimated completion date of mid-November, and includes the removal of the existing surface and respraying it using a new rubber-crumb coating.
The track is also next to Oakengates Leisure Centre which is soon to be refurbished with a 25-metre swimming pool.
Paul Sanderson, secretary of Telford Athletics Club said: “It is fantastic news that Telford & Wrekin Council are investing in the athletics track at Oakengates Leisure Centre.
“The resurfacing of the track combined with the upgrade of facilities for spectators will mean that not only can the facility continue to host local and regional events for many more years, but also the experience of those attending to support athletes will be much improved.
“With the next Commonwealth Games being held just down the road in Birmingham, it is exciting times for athletics in Telford.”
Further improvements to the spectator seating will also be agreed and scheduled to start in 2020.
Councillor Hilda Rhodes, cabinet member for parks, green spaces and the natural environment and Oakengates ward member, said: “This will be a very welcome investment in this well used facility.
“The profile of athletics as a sport is set to rise the closer we get to the 2022 Games and we want Telford to play a full part in that and investment like this is key to ensuring we are in the best position to do so.
“It’s another example of how we’re improving different community facilities to help create a better borough and attract more visitors and investment here.”