The TV licence fee, which funds the BBC, is to be frozen for six years at £145.50, the chancellor has confirmed.
The BBC will also take over the cost of the World Service, currently funded by the Foreign Office, as well as part-funding Welsh language TV channel S4C.
All the changes mean a 16% real terms cut in BBC funds over six years.
Director general Mark Thompson said it was "a realistic deal in exceptional circumstances securing a strong independent BBC".
Continue reading the main story Related storiesBBC must do more with less moneyS4C's legal challenge on BBC move
George Osborne said the changes in funding amounted to "£340m of savings a year for the Exchequer by 2014-15"
"To ensure that the cost of these new obligations is not passed on to the licence fee payer, the BBC has agreed a funding deal for the full duration of its charter review."
The arrangement was to freeze the licence fee for the next six years, he said.
"This deal helps almost every family and is equivalent to a 16% saving in the BBC budget over the period, similar to the savings in other major cultural institutions," Mr Osborne told the Commons.
Money the BBC had ringfenced to pay for the switchover to digital TV - about £150m a year - will now contribute to the broadband rollout.
Gerry Morrissey, general secretary of broadcasting union Bectu, said he was "alarmed" by Mr Osborne's announcement.
"It seems as if the BBC is now doing the government's dirty work. They have thrown in the towel, so they will now have to justify the cuts to staff," he said.
"How can you cut 16% off your costs without affecting jobs or services? Morale at the BBC is already at rock bottom, but now there is little or no confidence in the management."
'Cavalier and short-termist'
The BBC Trust earlier warned the government it would fight any move to force the corporation to meet the cost of free television licences for the over-75s.
A trust spokeswoman said it would be "unacceptable" for licence fee payers to foot the bill.
Last month, Foreign Secretary William Hague told MPs the World Service was of "huge importance" but could not expect to be immune from cost-cutting.
"Can the BBC World Service make itself more efficient and therefore contribute to the spending round? Yes, I think it can and it thinks it can," Mr Hague told the Commons Foreign Affairs Committee.
But shadow foreign secretary Yvette Cooper said she was concerned about the announcement.
"It is alarming that only 24 hours before the spending review, the funding of the World Service has been completely up in the air," she said.
"Although editorially independent, the World Service is a key component of UK diplomacy and does important work promoting British values and open debate across the world.
"Jettisoning it from the Foreign Office at this late stage, without serious consultation or a strategy for its future, is cavalier and short-termist."
The Department for Culture, Media and Sport currently funds S4C to the tune of just under £100m a year.
Along with the channel, the BBC will also take over the cost of BBC Monitoring, which monitors, translates and analyses media coverage from around the world.
BBC News - Television licence fee to be frozen for next six years
The BBC will also take over the cost of the World Service, currently funded by the Foreign Office, as well as part-funding Welsh language TV channel S4C.
All the changes mean a 16% real terms cut in BBC funds over six years.
Director general Mark Thompson said it was "a realistic deal in exceptional circumstances securing a strong independent BBC".
Continue reading the main story Related storiesBBC must do more with less moneyS4C's legal challenge on BBC move
George Osborne said the changes in funding amounted to "£340m of savings a year for the Exchequer by 2014-15"
"To ensure that the cost of these new obligations is not passed on to the licence fee payer, the BBC has agreed a funding deal for the full duration of its charter review."
The arrangement was to freeze the licence fee for the next six years, he said.
"This deal helps almost every family and is equivalent to a 16% saving in the BBC budget over the period, similar to the savings in other major cultural institutions," Mr Osborne told the Commons.
Money the BBC had ringfenced to pay for the switchover to digital TV - about £150m a year - will now contribute to the broadband rollout.
Gerry Morrissey, general secretary of broadcasting union Bectu, said he was "alarmed" by Mr Osborne's announcement.
"It seems as if the BBC is now doing the government's dirty work. They have thrown in the towel, so they will now have to justify the cuts to staff," he said.
"How can you cut 16% off your costs without affecting jobs or services? Morale at the BBC is already at rock bottom, but now there is little or no confidence in the management."
'Cavalier and short-termist'
The BBC Trust earlier warned the government it would fight any move to force the corporation to meet the cost of free television licences for the over-75s.
A trust spokeswoman said it would be "unacceptable" for licence fee payers to foot the bill.
Last month, Foreign Secretary William Hague told MPs the World Service was of "huge importance" but could not expect to be immune from cost-cutting.
"Can the BBC World Service make itself more efficient and therefore contribute to the spending round? Yes, I think it can and it thinks it can," Mr Hague told the Commons Foreign Affairs Committee.
But shadow foreign secretary Yvette Cooper said she was concerned about the announcement.
"It is alarming that only 24 hours before the spending review, the funding of the World Service has been completely up in the air," she said.
"Although editorially independent, the World Service is a key component of UK diplomacy and does important work promoting British values and open debate across the world.
"Jettisoning it from the Foreign Office at this late stage, without serious consultation or a strategy for its future, is cavalier and short-termist."
The Department for Culture, Media and Sport currently funds S4C to the tune of just under £100m a year.
Along with the channel, the BBC will also take over the cost of BBC Monitoring, which monitors, translates and analyses media coverage from around the world.
BBC News - Television licence fee to be frozen for next six years
