But interest rates on Spanish debt continued to rise, suggesting financial markets are pessimistic about the country's future, the Financial Times reported. The 17 ministers took the vote by conference call.
The aid package includes an immediate loan of 30 billion euros ($37 billion), The New York Times said.
There were signs of additional stress in Spain. Valencia requested help from a $22 billion fund set up by the Spanish government to aid regional economies, and there were protests in 80 cities against austerity measures.
The rate on the 10-year sovereign bond rose to more than 7 percent Thursday and remained there Friday, the Times said. Experts said that might leave the Spanish government unable to borrow.
The International Monetary Fund called on Spain's government to slow its deficit-cutting drive, saying the Spanish economy can't absorb so many cutbacks. IMF Managing Director Christine Lagarde said reductions should focus on reducing services for people with higher incomes and on sanctioning autonomous regional governments if they fail to hit their budget targets and incur huge debt, ThinkSpain reported.
The bailout memorandum of understanding follows Germany's approval Thursday of the arrangement, which includes 3 percent interest for 15 years and a 10-year grace period.
Lagarde said a slower-paced, deficit-reduction effort would help prevent the country's economy from collapsing.
Spain must improve crisis- and resolution-management in its banking sector and create an integrated communications strategy to include banks, results of independent evaluations indicated.
The evaluations also supported controversial labor reforms approved by lawmakers that relax restrictions on employers concerning paying and firing workers.
Spain's lower house of Parliament this week enacted the largest austerity package since democracy was restored in Spain in 1978.
The Congress of Deputies voted along party lines to cut $80 billion from government budgets by 2015.
Lawmakers promised later to address other parts of the austerity plan, such as speeding up moves to raise the retirement age to 67 from 65.
Prime Minister Mariano Rajoy went to Parliament and then quickly left after casting his vote in favor of sales-tax increases to 21 percent and the government spending cuts, including forcing government workers to take pay cuts of 3.5 percent to 7 percent and to forgo traditional Christmas bonuses.
A Rajoy spokesman told the Spanish newspaper El Pais Rajoy left Parliament quickly because he was "busy working at his desk."
The austerity vote prompted hundreds of thousands of Spaniards, led by public-sector workers, in more than 80 cities to march in the streets Thursday, protesting Rajoy's government.
Notable deaths of 2014 [PHOTOS]