The Welsh Government will give £3m towards building a new headquarters for S4C in Carmarthen.
The University of Wales Trinity St David asked for public funding after a bid for European money for Yr Egin was turned down.
A further £3m is expected to come from the Swansea Bay city deal.
Earlier in February, First Minister Carwyn Jones told AMs that S4C promised that the move from Cardiff would be at no cost to the taxpayer.
The investment comes despite an independent panel looking at the creative industries sector in Wales having advised the Welsh Government that it should not give public money to "Yr Egin".
Economy secretary Ken Skates said the scheme will inject life into the local economy.
"The investment will help to deliver the infrastructure needed to support the University's vision of a cluster of creative businesses in Carmarthen," he said.
A spokeswoman for the university said: "We look forward to working with the Welsh Government and other stakeholders on the project which will bring cultural and economic regeneration to the region."
S4C said it welcomed the decision and that it looks forward to moving in to the building next summer.
In October, Mr Skates told AMs it was "disappointing" a funding gap had appeared, but the university denied this was the case.
However a briefing paper sent by the university to the Welsh Government a month earlier stated public investment was needed for the project to "eliminate the financial viability gap".
Some campaigners called for the move to be scrapped in light of the cash request, and for S4C to move instead to Caernarfon.