Management committee president Rod Delahunty said the money would provide new barbecue amenities including a shelter, table, seats and a new electric barbecue, walking tracks and pathways, sprinkler systems and lawns.

"What we're going to do will lift it a lot, make it more presentable and green all year round with the new lawn areas where it used to be dry," he said.

Member for Swan Hill Peter Walsh said the upgrade would improve tourism and make the lake a hub of celebration and entertainment.

"The foreshore will be creatively landscaped and improved seating around the lake will encourage greater use by tourists and the community," he said.

"Foreshore revitalisation will provide better amenities for weddings, community celebrations, outdoor movie screenings, the Poets on the Pier, angling club events and the iconic Big Weekend Festival.

"Access will be improved through the installation of new interpretive signs and bollards, a new car park and an upgrade of vehicle access and power to the area."

Mr Delahunty said the major works represented the first step in developing the lake foreshore and the committee had plans for more projects.

"The community is all behind it and this is virtually the start. Within a couple of years we should have it where we want it," he said.

Mr Delahunty said the committee had worked on the proposal for about nine months and was delighted when news of the grant came through.

"When I got the phone call the other day, I was pretty happy," he said.

The total project cost is $190,000 with $40,000 from the committee and $10,000 from Yarriambiack Shire Council.

Mr Delahunty said support from the progress association, pool committee, Murtoa Lions Club, RSL, fire brigade, the fishing club and Murtoa community helped secure the project's finances.