The Way Youth Zone said the funding would strengthen its open-access youth work and employability support, helping young people to grow in confidence and learn new skills.
It will also mean extended opening hours, more targeted programmes, and greater access to youth workers.
Paul Snape, chief executive of The Way Youth Zone, said: “This partnership with the Jaguar Land Rover Foundation is a game-changer for young people in Wolverhampton.
“Their investment and commitment mean we can offer even more opportunities for young people to discover their potential, build confidence and prepare for the world of work.”
A spokesperson for the Jaguar Land Rover Foundation said: “It’s been inspiring to spend time at The Way Youth Zone and see the incredible impact it has.”