The redevelopment will see the theatre become the Roxy Institute of Performing Arts, a world class venue and community hub.

Member for Farrer Susan Ley and Minister for Resources, Water and Northern Australia announced the funding at the theatre on Tuesday.

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Leeton Shire Council general manager Jackie Kruger said the funding would allow the planned redevelopment of the Roxy to be bought to its full potential and would create 25 jobs through the construction phase and a further three permanent jobs once complete.

"Economic diversification is at the heart of this project and I think they tie in really nicely together with the work we have planned in bringing the Roxy into a new life," Mrs Kruger said.

The grant to the beloved Leeton institution is one of seven projects in the electorate of Farrer that have received their share of approximately $6.4 million in the third round of the EDP.

Mr Pitt said the funding was a means for communities like Leeton affected by the Murray-Darling Basin Plan to be at the heart of decisions on how to stimulate their economies.

"The approved projects will create new jobs as they are delivered as well as enduring employment opportunities, increase the capacity of communities to diversify and strengthen their local economies, and help them to manage their current and future economic challenges and changes," he said.

Close to $4 million has already been invested into projects in the electorate of Farrer in the first two rounds of the EDP.

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"Leeton is the home of irrigated agriculture and whilst water underpins the economy, it is crucial we diversify and invest in something different," Ms Ley said.

"This is about the performing arts which I believe has a real scope for success in regional communities like Leeton.

"You only have to step into the Roxy to feel its magic."

According to Mrs Kruger, the funding will go towards work such as as the awning, back areas, a full repaint of the auditorium and ensuring that the water pressure in the theatre is correct for fire compliance.

Leeton Shire mayor Paul Maytom said the community was grateful to receive the funding for the Roxy.

"This is a massive project and we are all so proud of our theatre, this additional funding is icing on the cake on top of the other funding we have already secured."

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