The £228,000 Defra grant will be used to monitor and improve traffic flows and reduce congestion in the City of Wolverhampton.
The funding follows Defra's recognition for essential improvements to tackle air pollution in the City of Wolverhampton.
The grant will enable the city council to implement much needed road improvements that will have a positive impact on air quality, making the city cleaner, greener and better as well as keeping the city moving.
The grant will support the implementation of measures identified in the supplement to the UK plan for tackling roadside nitrogen dioxide emissions.
In addition, Defra has issued the West Midlands Combined Authority £3million to improve emissions of the bus fleet which will be delivered by Transport for West Midlands (TfWM).
As part of the National Air Quality Strategy Defra have identified certain busy roads in City of Wolverhampton as having a continued breach of the National Air Quality Limit for Nitrogen Dioxide.
The proposed measures required for improvement include traffic signal upgrades, widening of busy routes on the Ring Road and reviewing layouts to reduce congestion, improve traffic flow and air quality.
Identified routes include Bilston Street Island, Ring Road/Broad Street, and Horseley Fields/Corn Hill.
Councillor Steve Evans, Cabinet Member for City Environment at City of Wolverhampton Council, said: "Poor air quality has a direct effect on health and wellbeing. By implementing these measures, it is intended to improve pollution levels with a consequential benefit in public health.
"We are pleased to have been granted the funding by Defra to enable these essential works to be carried out and this recognises the hard work of our officers in dealing with these issues.
"As set out by Defra, we will work to implement improvements on the identified routes while keeping traffic disruption to a minimum, which will have a positive impact on air quality and a reduction in pollution levels in and around the city.
"Moving forward, the city will see new developments such as the Midland Metro extension, new Interchange, highway improvements, and the use of ultra low emission vehicles - all leading to a cleaner, greener city.
"As a council, we take our statutory duty to improve air quality very seriously and will continue to work with Defra and public health partners to address this important issue.
"In addition, Transport for West Midlands funding to deliver cleaner buses and improved facilities will ensure a better environment all round for passengers."