South Yorkshire’s buses are due to come under public control from September 2027, with routes, timetables and tickets to be decided locally.
Mayor Oliver Coppard said: “Public transport in South Yorkshire used to be world class. But our buses have been broken for too long.
“Now, we’re getting on with the job of delivering the promise of a bigger, better transport network, starting with our huge ambition for better buses.”
He said the investment would mean “cleaner air, more reliable buses and a much better experience for people”.
“This is exactly the kind of practical, everyday progress we can deliver through bus franchising,” he added.
“Taking back control, putting people first and building a transport system that works for South Yorkshire.”
The government’s contribution to Sheffield accounts for 46% of a £73.2m package for zero-emissions buses across England and comes on top of a £20m investment in 2025.
It builds on the its Zero Emission Bus Regional Areas programme which has funded more than 2,500 cleaner buses nationally.