A planning application is being drawn up for the Abbey Shopping Centre and the Charter multi-storey car park.
The plans will see the council-owned 40-year-old retail space updated and the dated street area improved.
Subject to planning permission being granted, work on the overhaul could begin on the shopping centre in January 2012.
Councillor Richard Gibson said: "This deal means that over the next few years there will be more and better shops. This will attract more people to the town, providing more jobs and greater prosperity."
A second phase of plans will see the Charter multi-storey car park demolished and redeveloped.
It will be replaced with a large supermarket and 400-space car park, library and a day and medical centre.
A £53m major regeneration project for Abingdon town centre in Oxfordshire has been secured.