This will fund a range of schemes including renewal of the Supertram network connecting Sheffield and Rotherham.
Plans laid out for the renewal of the service includes improvements to the network with a fleet of close to 30 trams, track improvements, better facilities for passengers, refurbishment and extension of the depot, renewal of control, signalling and communications systems and renewed and enlarged power supply.
The DfT has also handed Supertram £4 million in grant funding to continue its recovery from the effects of the pandemic.
Tentative plans are afoot for potential future tram-train expansion which includes a route beyond Parkgate in Rotherham and adding stops on existing routes at Swinton, Warmsworth in Doncaster and the town centre.
Places in Sheffield like Beighton, Stocksbridge, Heeley, Millhouses, Totley, Chapeltown, Woodhouse and Handsworth could all in future become part of the tram-train network, using existing rail routes.
Places like Meadowhead and other stops along the A61 Chesterfield Road could also be used in a later expansion plan.
Sheffield City Region bosses are keen to expand the service to Barnsley and Doncaster. Both councils pay a levy towards the network without directly benefiting.
Mayor Dan Jarvis has previously said that there is an ambition to roll the network out from Waverley towards Mexborugh before a terminus at Doncaster Sheffield Airport and also towns in the Barnsley Dearne Valley area.
Stagecoach has responsibility for the operation and maintenance of the network until 2024 but ownership of the asset remains with South Yorkshire Passenger Transport Executive.
Sheffield City Region transport bosse have previously said the current preferred model after 2024 is that the operation of the network be carried out by an organisation owned by the public sector with renewal works to 2028 managed by Sheffield City Region.
Transport Secretary Grant Shapps said: “Buses and trams are the most popular way of getting around in this country – but for too long people outside of London have had a raw deal.
“The investment we’re making today to ramp up the bus revolution will drive down fares at a time when people’s finances are tight and help connect communities across England.”