Yemenia has signed a memorandum of understanding with Airbus for 10 A320s.
The deal, which calls for deliveries to begin in late 2011, is worth $700 million at list prices. An engine selection has not been made.
Speaking at the signing during the Dubai air show, Yemenia board member Saleh Alawaji said the order will help the airline "live up to its role as a major catalyst in the region".
The A320s, which will be delivered over four years, will be deployed on Yemenia's existing services and new routes to Africa, India and Europe, as well as on regional flights.
Airbus chief operating officer customers John Leahy says that the delivery slots have been vacated by another customer. "I managed to find a few slots in 2011," he says. He adds that he expects the contract will be firmed up "in the next 30 days".
Yemenia's current fleet comprises three A310s, two A330s, one Boeing 727, four 737-800s and three Bombardier Dash 8s and a Twin Otter. It holds orders for 10 A350 XWBs.
Although Alawaji says the carrier plans to phase out its A310s with the introduction of the A320s, but intends to retain its four 737-800s - all of which are leased from International Lease Finance.