Over €1.45m has been made available under the European Regional Development Fund to build the gallery and adjoining studio area.
Westmeath County Council received a further €1.2m to facilitate works along the Mullingar cycle route.
Mayor Mark Cooney said the developments would help Athlone achieve its potential as a 'gateway town'.
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The gallery, due to open in late 2010, represents a major development in the provision of cultural infrastructure in Athlone and the Midlands region.
Father Matthew Hall on the banks of the River Shannon will be the home of this flagship cultural development.
County Council Chairman Fintan Cooney welcomed the proposal to establish more cycle routes in Mullingar.
The grant aided project involves the creation of approximately 20km of cycle lanes along the most important arterial desire lines for cyclists.
It includes appropriately coloured and textured surfacing, signage, cycle parking facilities, and appropriate interconnectivity with existing cycle routes.
(PR/GK)
