Belanger Construction will undertake road repair work on the Highway 17 interchange at Municipal Road 55 near Sudbury.
The work, which includes upgrades to a nearby railroad overpass, is expected to create 40 jobs.
"Our investments in the Northern Highways Program improve safety, spur business development, create jobs and keep people and goods moving,” Northern Development Minister Rick Bartolucci said in a news release.
Work is expected to start in June and be complete by 2013. Since 2003, the Ontario government has invested $4.5 billion in highway infrastructure as part of the Northern Highways Program.
Projects have included the improvement of 2,560 kilometres of highway and 185 bridges, the construction of 105 kilometres of new four-lane highway, and the construction of 115 new bridges throughout Northern Ontario.