During a press conference at his office, Mr Awiti explained that the plan will see the construction of modern stalls, parking bays, new toilets and garbage handling equipment.
Mr Awiti said his government had initially allocated Sh20 million to the project but will spend more to supplement the donation by the national government.
Homa Bay county government is set to construct an ultra-modern market at Oyugis in Kasipul constituency at a cost of Sh250 million.
Governor Cyprian Awiti announced that work on the project — a partnership between the county government and the Ministry of Lands will commence in January 2016.