£3.6 million could be spent extending and refurbishing St Mary’s Roman Catholic Primary School.
The Department of Education, Sport and Culture will ask Tynwald for the money when it sits later this month.
Plans for the refurbishment and extension of the Douglas school were first unveiled in May last year – the work is needed due to the age of the building and demand for school places.
Five new classrooms could be added along with an extension to the school hall and two existing classrooms.
Two internal lifts would also be installed to provide disabled access across the entire site – along with additional disabled toilets – and the roof, windows and doors would be replaced.
Minister Graham Cregeen says: "This funding, if approved, would represent a major investment in primary education in the Island's capital.
"St Mary's is a popular school with a strong track record, and the demand has been accommodated for a long time through the use of the mobile classrooms to supplement the permanent class-bases.
"We need to provide new additional permanent capacity at the school, so that these mobiles can be removed."
Planning permission for the alterations was granted in July 2017.
It's hoped work could start later this month with completion by August 2019.