"This is only the latest example that when it comes to defense, military, and intelligence cooperation, the relationship between the US and Israel has never been stronger," said Democratic Representative Steve Rothman.
Israel completed tests in January on its Iron Dome system, designed to intercept short-range rockets and artillery shells fired at Israel by Hamas and Hezbollah.
The next phase is to integrate the system into the army. Israel hopes the Iron Dome will help counter rocket fire from the Hamas-ruled Gaza Strip and from Lebanon.
Palestinian militants have fired thousands of home-made rockets into southern Israel, prompting Israel's devastating assault on the Islamist Hamas in Gaza on December 27, 2008.
The Lebanese militant group Hezbollah also fired some 4,000 rockets into northern Israel during a 2006 war with Israel. The group is believed to have an arsenal of some 40,000 rockets.
"This funding sends a strong message, to both our enemies and allies, by providing more total dollars than ever before toward these rocket and missile defense programmes," said Rothman, a key backer of the funding.