Theresa May and Saudi Arabia's Crown Prince have used talks in Downing Street to lay plans for a £65 billion trade and investment package.
The Prime Minister's discussions with Mohammed bin Salman also touched on the conflict and humanitarian crisis in Yemen.
The crown prince's visit has caused controversy due to Saudi Arabia's role in the war in Yemen, and the country's human rights record.
A Downing Street spokeswoman said: "The meeting agreed a landmark ambition for around £65 billion of mutual trade and investment opportunities over the coming years, including direct investment in the UK and new Saudi public procurement with UK companies."
The spokesman said that Mrs May brought-up the issues of Yemen and human rights in the talks.
She said: "The Prime Minister raised our deep concerns at the humanitarian situation in Yemen.
"The Prime Minister and crown prince agreed on the importance of full and unfettered humanitarian and commercial access, including through the ports, and that a political solution was ultimately the only way to end the conflict and humanitarian suffering in Yemen."
The comments came after Labour leader Jeremy Corbyn accused the Government of "colluding" in war crimes by Saudi forces engaged in Yemen's bitter civil war.
The Labour leader said British military personnel were "directing" Saudi military operations responsible for large-scale civilian casualties.
Foreign Secretary Boris Johnson defended the UK's ties to Saudi Arabia, saying: "The closer our relations the more able we will be, we believe, to influence the conduct of that war."
Mr Johnson rejected claims that the UK was involved in directing the military campaign.
Yemen has been embroiled in a bloody civil war since 2014 when rebels took over the capital city of Sanaa.
Saudi Arabia is the main player in a coalition supporting the Yemeni government against the Houthis in a war which has caused a humanitarian catastrophe.
The crown prince has been the driving force behind a modernisation programme, Vision 2030, in Saudi Arabia - but the reforms have been dismissed as a "mirage" by campaigners.
On Wednesday, he had lunch with the Queen and the Duke of York and was to have dinner with the Prince of Wales and the Duke of Cambridge as the UK rolled out the red carpet for the controversial figure.
On Thursday, the crown prince will head to Chequers for talks and a private dinner with the PM that will focus on foreign policy issues, including Yemen and Iran.
On Friday, he will meet Defence Secretary Gavin Williamson for talks.
According to analysis by human rights charity Reprieve, executions have doubled under the Crown Prince.
The organisation said since his appointment in July 2017, 133 people had been executed compared with 67 in the previous eight months.
Amnesty International said reforms in Saudi Arabia were "largely a mirage", with "peaceful critics" of the government thrown in jail and women reliant on permission from men if they want to travel, be educated or get a job.
UK director Kate Allen said: "We'd like to see Theresa May finally showing some backbone in the UK's relationship with Saudi Arabia."
Rob Williams, chief executive at War Child UK - a charity for children affected by conflict, said: "Britain is complicit in the humanitarian crisis in Yemen through providing diplomatic support to Saudi Arabia, as well as selling our most high tech and deadly weapons to a coalition that the United Nations has verified as committing grave violations against children."