It said it hoped its decision would encourage more lending by international donors.
Meanwhile, new flooding has been reported from around the town of Dadu, near the Indus river in Sindh province.
The army is continuing relief efforts, rescuing hundreds of people trapped or isolated by floodwaters, in the area.
"The [IMF] board's approval enables the immediate disbursement of the full amount of this emergency assistance," the IMF said in a statement.
"Pakistan's economic outlook has deteriorated sharply as a result of the floods. The agriculture sector, which accounts for 21% of Gross Domestic Product and 45% of employment, has been hit particularly hard," it added.
The floods which hit the country at the end of July have killed at least 1,500 people and devastated large areas.
The United Nations has said that billions of dollars would be needed in the long term.
But charities say the response to the UN's appeal has been sluggish.
The US has made the biggest contribution so far, followed by the UK.
UK Deputy Prime Minister Nick Clegg has called the international response "lamentable".