Silverstone has agreed a 17-year deal to host the British Grand Prix from 2010, ensuring the prestigious race is not axed from the Formula 1 calendar.
The Northamptonshire circuit stepped in to stage the event which next year takes place on 11 July after Donington Park was stripped of the rights.
And the news ensures the oldest race on the F1 calendar retains its place.
Under the new agreement, Silverstone, which hosted this year's British Grand Prix in July, will be redeveloped.
The modernisation of the facilities at Silverstone, which first staged the British Grand Prix in 1948, will focus on rebuilding the pit lanes and paddock.
"This announcement is tremendous news," said 1996 F1 world champions Damon Hill who is president of the British Racing Drivers Club president (BRDC), which owns Silverstone.
"It's not easy to enter into an agreement of this magnitude. It's a big commitment.
"But the BRDC felt we wanted this relationship to continue, and we were prepared to back the negotiating team, with the level of risk satisfactory for the deal to go ahead."
Silverstone managing director Richard Phillips said: "We've always had five-year deals and never been able to get the investment we needed to redevelop.
"But 17 years gives us the ability to invest and move forward.
"We've always had the belief the British Grand Prix was an important cornerstone of Formula One but, with Bernie, you're never quite sure, at the end of the day, though, you have to have a British Grand Prix."
More to follow.