Air New Zealand is to start twice-weekly flights to Sydney from Rotorua airport from 12 December.
The national carrier will operate the flights on a Saturday to Monday service, before moving to a Saturday to Tuesday service from February next year.
The airport, which has been trying to secure an international carrier for almost a decade, says the move could create between 70 and 130 jobs in the region.
In the past two years, a new international arrival and departure lounge has been built and border control offices and gateways have been installed.
A resurfaced and lengthened runway to cope with bigger planes is also nearly finished. Air New Zealand will be flying its A320 aircraft on the trans-Tasman route.
In 2007 more than 205,000 Australians visited Rotorua, and by the end of 2014 this is forecast to rise by more than 60,000 a year.
Rotorua Mayor Kevin Winters says the deal with Air New Zealand marks the end of a seven-year journey, which began with the district council buying a 50% shareholding private investment company.
Mr Winters says the region has the destinations and attractions to increase the number of flights it can support, up to 14 per week.