The deal will invest money in projects designed to help the economic growth of Inverness and the Highlands, and is expected to create more than 3,000 jobs over the next two decades.
The money is made up of £135m from the Scottish Government, £53m from the UK government and £127m from the Highland Council and regional partners.
City Deals were created by the UK Government as a way to provide UK cities with the power and resources to unlock the economic potential of their city.
Welcoming the City Deal, MSP Keith Brown said: “Cities and their regions are the engines of our economy.
“Today’s City Deal announcement demonstrates our clear and strong commitment to Inverness and the wider Highland region, which we recognise have a key contribution to make to the future prosperity and economic growth for Scotland.
"That is why the Scottish Government has agreed to invest £135m as part of a £315m City Deal for Inverness that will deliver significant long-term benefits for the city, region and Scotland as a whole.
“This deal provides an opportunity to enhance and accelerate the delivery of long-term aspirations held by the Scottish Government and The Highland Council, the impact of which could help increase the population, create thousands of jobs and help to up-skill the local labour market.”
Funding will be targeted towards improving the regions transport and digital connectivity networks, fostering innovation of high growth businesses through the creation of a Northern Scotland Innovation Hub, promoting tourism and delivery of local housing and assisted living schemes.