The 10-year plan includes doubling the size of Terminal 2, expanding self-service check-in facilities and building a larger security hall.
Manchester City Council also approved plans to demolish Terminal 1 and build a ramp from an M56 slip road to give access to a new departures forecourt.
The work, which is due to begin at the end of the year, also includes improvements to Terminal 3.
Manchester Airports Group (MAG) said the investment will mean it "continues to thrive as a national asset".
Charlie Cornish, chief executive of MAG, said: "The transformation programme will ensure the airport plays its full part in driving economic growth and develops as a key part of the UK transport infrastructure."
Manchester Airport in numbers
- Manchester Airport officially opened in 1938
- Around 22 million passengers pass through the airport every year
- About 19,000 people are employed on the site
- Two runways serve the airport with three terminals, 42 air bridges and 254 check-in desks
- Around a million pints of beer are downed by passengers each year along with 300,000 breakfasts and more than three million hot drinks.
Source: bbc.co.uk/news