Following months of negotiations, the authority has taken ownership of the strategically important Captain Cook Square and House of Fraser sites.
The multi-million pound investment is part of a long-term drive to transform the future of the high street through a better balance of retail, leisure and residential space.
The approach was agreed by Middlesbrough Council's Executive last December and has seen the council working in partnership with commercial property experts Knight Frank.
The move is also the basis for a bid for £20 million from the Government's Future High Streets Fund (FHSF).
Over the longer term a healthier mix across the town will help to attract investment and drive up footfall, revitalising the town and delivering much-needed economic benefits.
Around 300,000 sq ft of space - 25% of the high street stock - will be re-purposed to create the largest cultural and leisure hub in a 50-mile radius.
Middlesbrough Mayor Andy Preston said: "This is a great bit of business that gives us a much greater say in the future success and prosperity of the town centre.
"The challenges were there even before the chaos wreaked by the coronavirus pandemic, so it's more important than ever that we invest creatively and effectively in the health and long-term viability of our town centre.
"There's amazing potential, but major changes are needed if we're to fulfil that potential and open up a whole new chapter in Middlesbrough's history.
"This is all about giving people alternative reasons to be in central Middlesbrough, rather than just shopping.
"These are undoubtedly tough times, but the prospects are exciting too, and I'm really looking forward to working with all of the existing business to keep them in Middlesbrough and ensure they play their part in a bright future."
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