The Idaho Board of Education voted on Monday morning to back the Moscow-based school's acquisition.
The land on the shore of Payette Lake is currently part of Idaho's endowment, but has been leased by the University of Idaho for the last six decades.
The lease was boosted earlier this year to $250,000, from just $50,000.
The UI anticipates bond payments to finance the acquisition will be less than $250,000 annually.
The state aims to swap the McCall property with a privately-owned Idaho Falls office building.
Then, the UI would buy the land at its appraised value, about $6.1 million, from the private owner.