tate approval of the Jets' proposed $2.2 billion stadium on the West Side of Manhattan this week nearly unraveled in a dispute over $40 million.

The Jets had offered $210 million for the right to build the stadium over the railyards between 11th and 12th Avenues, from 30th to 33rd Street. But the Metropolitan Transportation Authority, which owns the yards, was holding out for $250 million.

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The cost of building the stadium itself had already swelled to $1.9 billion from $1 billion, and Jets executives were reluctant to give in, according to executives on both sides of the bargaining table. But Charles A. Gargano, chairman of the Empire State Development Corporation, said his board would not consider the project for approval at its meeting on Tuesday unless the team had a deal with the M.T.A.

Rather than risk a delay in obtaining state approval and a potentially fatal loss of momentum, the team ultimately blinked, boosting its offer by $40 million on Monday, less than 24 hours before the board of the development corporation met to discuss the project.

"I had a sense of my board that they wanted $250 million in one lump sum, and I was in no position to take anything less," Peter S. Kalikow, chairman of the transportation authority, said yesterday.

The Jets and the M.T.A. ultimately signed a "term sheet" outlining their $250 million deal, and the stadium project entered the final stage of the approval process, which is still by no means assured.

Cablevision, which owns Madison Square Garden and views the stadium as competition, has sued to break up the Jets' deal, saying that the authority violated its duty to commuters when it rejected the company's higher, $400 million offer for the property on March 31. A hearing is scheduled for May 3.

Under the terms of the Jets deal, the authority will retain ownership of the land, while the Jets will pay $250 million for the right to build a stadium on a platform over the railyard. The team cannot build anything other than the stadium, which will also function as an exhibition hall in conjunction with the nearby convention center.

If and when the state's Public Authorities Control Board approves the project, the Jets will sign a contract and pay a nonrefundable $50 million. The team, which has said it must gain final approval by the end of May, would pay the remaining $200 million at the closing of the deal.

The three-member board is appointed by Gov. George E. Pataki, Assembly Speaker Sheldon Silver and the Senate majority leader, Joseph L. Bruno. Although Mr. Pataki backs the stadium, the two legislators have expressed qualms, and it is unclear whether they will even review the matter before July.