The deal, which is worth $318 million, also entails the construction of a new airport city and an exclusive economic zone.
Transport and Aviation Minister, Leonard Balogun Koroma headed a delegation to Beijing in China where the contract and loan agreements were signed on Thursday.
The Chinese construction firms Henan Guoji Industries and China Railway International Group will construct the facilities, with funds provided by the China Exim Bank.
Mr Koroma said in reports on Friday that the project will solve a major development hindrance for the country.
“The construction of the new airport will address the longstanding problem of the often cumbersome estuary crossing between Lungi and Freetown,” he said in a statement.
The current Lungi Airport is located outside Freetown, separated from the capital city by a river estuary that empties into the Atlantic Ocean.
It is mostly accessible by ferry.
An alternative route involves a long drive through the northern part of the country.
The proposed Mamamah International Airport, which will also be located in the mainland, is just a few kilometers outside the capital.
The project, according to officials, will create 4000 jobs during the course of the four-year construction period.
The new airport is expected to become operational in 2022.
President Koroma is expected to commission the construction work, alongside with a private sector study of the New Koya City on March 1, less than a week before Sierra Leoneans head to the polls to election a new president.
However, the project has long been opposed by the World Bank and IMF, who question its viability, in addition to the argument that the country has more pressing priorities.
Opposition political parties have also criticized the agreement as retrogressive.