The Vue chain ditched a scheme granted planning permission in 2012 for a cinema in the Buttermarket centre.
But the borough council has approved a new proposal for a 16-screen multiplex, gym, new shops, restaurants and bars.
The centre, which opened in 1992, was bought in March for £9.2m by Capital & Regional and Drum Property Group.
The application has been granted subject to a number of conditions.
It is hoped the multiplex will increase visitor numbers to the town, especially in the evening.
Hugh Scott-Barrett, chief executive of Capital & Regional, said: "We believe our proposals will revitalise not just Buttermarket shopping centre but Ipswich town centre as a whole by introducing a tailored mix of retail and leisure facilities."
The new scheme also includes the widening of the St Stephen's Lane atrium inside the centre and six new restaurants and bars on the ground floor.
The new 16-screen cinema will span the building's three floors.
An area for a large store will remain on the ground floor but there will also be seven other shops, restaurants and bars.
"We have a real opportunity to develop Buttermarket into a vibrant shopping centre everyone can be proud of," Mr Scott-Barrett said.
An Ipswich shopping centre is to be transformed with a multi-screen cinema after previously abandoned plans were altered.