Federal Member for Parkes and Minister for Regional Services Mark Coulton announced more than $1 million in funding for Dubbo's St Pius X Catholic Primary School on Wednesday.
The federal government will provide $1,072,077 towards the school's infrastructure project through the Capital Grants Program.
Mr Coulton said the project consists of numerous upgrades to the school facilities.
"The project includes the demolition of an existing classroom block, administration and pupil facilities and covered outdoor area," he said.
It feels like I have won a million dollars.Heather Irwin
"It also includes the construction of a covered outdoor area for administration and pupil facilities, as well as four general learning areas. There will also be a further refurbishment of general learning and outdoor areas.
St Pius X Catholic Primary School principal Heather Irwin, who is set for retirement in the new year, said she was: "thankful to the government that my pleas for help have finally been answered."
"It feels like I have won a million dollars," Ms Irwin said.
"I'm very happy that this legacy is being left to St Pius when I leave.
"For years, I've been approaching the CEO, writing letters and reports, but they couldn't do anything until they approached the government. So this announcement is so great, and I am pleased."
Ms Irwin said this is one of the biggest projects she has seen the school undergo during her many years there as the principal.
"It is so exciting," she said.
"For me, it's the end of a brilliant career, and I can't thank the government enough, because when you do these things, you do them for the children and the staff."
Ms Irwin said the work to the infrastructure of the school would begin as early as next year, with a goal of nine months for its completion.
Mr Coulton said it is important for children in country towns to have the "absolute best facilities possible."
He said providing a private school with funding as opposed to a public school stems from an agreement between the federal and state government.
"The state government funds state schools, we fund just under 20 per cent," he said. "Part of the funding arrangements are that the federal government are the major partners for the private segment.
"Our government is ensuring that every child gets a quality education no matter where they go to school."