A regional distribution centre is to be built by Home Bargains owner TJ Morris at Solstice Park near Amesbury in Wiltshire.
The organisation is investing £70 million in the new location, which will occupy a 64-acre plot, Logistics Manager reports.
It marks the latest expansion by the brand, which has fared particularly well during the recession because of its discount prices.
Joe Morris, TJ Morris' operations director, said the location is ideal because 98 per cent of the south of England can be reached within 45 minutes of the distribution centre.
He added the warehouse will be "among the most advanced in western Europe", as it is set to make use of a state of the art electronic picking system, as well as a range of in-house technology.
By 2018, Home Bargains wants to have 700 stores in the UK, which would represent a significant expansion as it currently only has around 300 outlets.