"A formal contract was signed here today," a Defence Acquisition Programme Administration spokesman told AFP.
One of the modified 737 planes will be delivered in 2011 and three in 2013, he said of the deal first announced earlier this month.
The planes encompass a variety of aircraft control and advanced radar systems that can track airborne and maritime targets simultaneously, and direct fighter jets and ships to engage them.
They have an operational ceiling of 12,400 meters (41,000 feet) and a flight range that exceeds 3,500 nautical miles, and can carry two pilots and up to 10 mission crew.
South Korea, which is still technically at war with North Korea, has no air surveillance system of its own and depends on US airborne reconnaissance aircraft based at Okinawa in Japan.
South Korea has generally favoured defence equipment from the United States, which has kept troops here since the 1950-53 Korean War to deter aggression by North Korea.
However, last year Seoul picked Eurocopter as lead partner in a multi-billion dollar project to develop multi-purpose military helicopters. In February an Israeli firm won an 80 million dollar deal to upgrade optical surveillance systems on South Korean fighter aircraft.

Copyright AFP (Agence France-Presse), 2006