Council originally set aside $190,000 for the project as part of its capital works budget but further investigations led to requiring a further $406,000 for an alternative design.
Council assessed the yards over the past 12 months and determined corrosion damage among a number of livestock pens.
Mayor Seema Abdullah said the new safety measures were for animal welfare as well as users and staff of the New Dookie Rd site.
She said there would be further improvements to lighting and water connections.
“The safety is paramount,” she said.
“Looking at the current conditions of the pens it was very obvious they needed this repair so we can continue using the facility in a safe way.”
Deputy Mayor Dinny Adem said the issues were raised more than 12 months ago by the management committee.
“We thought we could get away with minor repairs but unfortunately after some extensive inspections we had to do more work than expected,” he said.
“It is a lot of money . . . however the saleyards are actually one of the few parts of council that creates income; a positive income at least.
“We have the money to spend on it. We need to do it to secure our existing extent with respect to how much sales we do and how much we can take.”
Cr Fern Summer said council could consider investigating a greenfield site outside of Shepparton's central district.
She said the saleyards were based in an area of Shepparton that would soon experience growth.
“It's a lot of money going to one location that may not be the most appropriate moving forward.”
Council said work would start in mid-to-late October and take about 20 weeks to complete.