An emergency meeting by the government council of foreign affairs and defence chaired by Prime Minister Alexis Tsipras approved the decision, the PM's office said.

"The council unanimously approved the implementation of the 85-plane upgrade programme," Tsipras' office said.

It added that the decision was based on "preliminary approval" by the US of a "revised Greek proposal taking into account the country's fiscal obligations over the coming years."

Defence Minister Panos Kammenos said the planes would be upgraded to F-16 Viper level.

No details on the cost or delivery dates of the programme were given.

Greece operates a fleet of some 150 F-16s in all.

The deal had originally been announced in October during a Tsipras visit to Washington.

But the government came under immediate criticism over the price tag, estimated at $2.4 billion at the time for a 10-year programme.

Athens had insisted the cost would not exceed $1.3 billion and would not destabilise its precarious budget.

Reports on Saturday said the programme agreed runs to 2021 at a cost of 450 million euros.

Tsipras has said the planes, some of them dating from 1989, risked being rendered inoperable without the upgrade.

Greece spends two percent of its budget on defence, one of only five NATO members to meet this alliance target.

Greek fighter planes see extensive action in the Aegean Sea.

They are regularly scrambled to intercept Turkish jets entering what Athens considers Greek airspace over the Aegean, occasionally engaging in mock dogfights.

A Greek pilot died earlier this month when his French-made Mirage 2000-5 plane crashed in the sea on the way back from an intercept mission.