Among the projects into which funds will be pumped are two, 6,000 seater municipal stadia – at Scotstoun in Glasgow and Sighthill in Edinburgh.
Scotstoun will have two new stands, office space and an indoor training area, with work due to be completed in 2007.
Such stadia could provide a home for a professional rugby team as well as access to the latest in training facilities.
"This is wonderful news for Glasgow Warriors, especially coming on the back of the very successful IRB Under 21 World Championship that was held in Scotland last month with excellent support from the Scottish Executive and Glasgow City Council among others," Bill Nolan, Glasgow Warriors's chairman, told the official Glasgow website "We look forward to continuing that partnership with the Scottish Executive and Glasgow City Council in utilising Scotstoun's new facilities for Glasgow Warriors in the near future."
David Jordan, Glasgow Warriors's chief executive, and the coaching personnel have been in talks with the City Council over the proposed developments at Scotstoun. Today's news, bringing those discussions closer to fulfilment, means that Glasgow could have the opportunity to move into a purpose-built home at Scotstoun in four or five years' time.
Glasgow's player are already making good use of Glasgow City Council's new weight-training facilities at the Palace of Arts.
Scottish Rugby's chief executive Phil Anderton welcomed the news, telling the Official SRU website: "Scottish Rugby is delighted to learn of this major investment in the future of sport in Scotland. We are particularly encouraged that the emphasis is on providing quality facilities for elite athletes while at the same time remaining true to the ethos of sport for all in making these facilities available for the wider community."