London Mayor Boris Johnson was in Northern Ireland on Friday to open the Wrightbus manufacturing plant in Antrim, that will produce the chassis for the new fleet of buses.
He hailed the double-decker as one of the greenest in the world and urged greater investment in public transport.
The buses can achieve fuel efficiency of around 11 miles to the gallon.
It takes around eight weeks to build one of the vehicles and the contract with Wrightbus is worth around £200m.
The order will see the workforce at the new chassis plant more than double from 40 people to 90 when full production gets started.
The contract will also safeguard 220 jobs and sustain 18 apprenticeships in the Newpark Industrial Estate.
Mr Johnson said: "It is a beautiful thing, it is beautiful for everybody in London, they know they are in the presence of an ascetic masterpiece, a wonder of British design."
"It is a real sign of the confidence that we have in British manufacturing that we have now delivered a bus that is frankly knocking spots off every other green bus around the world."
He said the buses are charismatic "mega fauna" for London which help to drive employment around the country.
The mayor said a million more people would come into London by 2021.
"We have got to keep investing in capacity, we will be making our case (to the Treasury) in the normal robust way."
He added: "We cannot cut into the bone and sinew of London's transport infrastructure."
Enterprise Minister Arlene Foster said: "It's good to see the Mayor of London coming back to Northern Ireland to meet the staff at Wrightbus, who are producing what is set to become an iconic London bus.
"I have no doubt that the company's continued focus on innovation will further bolster its position as a significant player in key national and international markets."
Sir Peter Hendy, the Commissioner of Transport for London, joined Mr Johnson on a tour of Wrightbus factories in Ballymena and Antrim, watching work including the fitting of windscreens.
He said there could be more orders for Wrightbus as the English capital takes delivery of 600 of the characteristic red vehicles over the next three years.
"These vehicles are so popular, I am sure there will be more of them. We think they are fantastic," said Sir Hendy.
The new vehicle is the greenest diesel-electric hybrid bus in the world, producing 20% less carbon dioxide then the fleet average hybrid bus, Transport for London said.
As well as the manufacture of the chassis and superstructure in Northern Ireland, a number of components are made by companies from around the UK.
Eight vehicles are already in use in London and by the end of June, route 24, which passes Parliament and Trafalgar Square, will use the new vehicles exclusively.
Each bus costs around £354,500 and has an estimated lifespan of 14 years.