Sheffield University expects to create 100 academic posts at what it describes as "the UK's largest multidisciplinary research complex".
The university plans to spend £20 million over the next two years creating two research institutes on an 18,400m2 site.
The institutes, the Kroto Institute and the Nanoscience and Technology Centre, are designed to embrace a "new wave of science" in areas such as nanotechnology, tissue engineering and virtual reality, according to the university. The bulk of the new posts, in research, will be filled over the next five years.
Sheffield claims that the development, on a brownfield site that includes the former government health and safety laboratory, will rival in size and scope Manchester University's Interdisciplinary Biocentre, scheduled to open this summer.
George Rees, business development manager for the Sheffield site, which will become the university's new north campus, said it represented the positive side of a sector-wide trend towards replacing pure science departments with research requiring a multidisciplinary approach.
The institutes would be distinctive in that their work would be "purely multidisciplinary", rather than based in or led by a particular department, he said.
"The challenge for science and engineering generally is how we allow these multidisciplinary areas to grow and whether we are prepared to be flexible to maximise their impact," he said.
"It is not easy for universities to grow rapidly in this area, but with this development we are trying to make a bold move."
The Kroto Institute, named in honour of the Nobel prizewinning chemist and Sheffield alumnus Sir Harry Kroto, will focus on a range of research including futuristic materials, environmental engineering, human tissue growth and virtual reality for scientific use. The Nanoscience and Technology Centre will specialise in electronic nanotechnology.
Geof Tomlinson, Sheffield's pro vice-chancellor for research, said redeveloping the brownfield site, with financial backing from the Science Research Infrastructure Fund, was the "ideal solution" for the university.
"It means we can locate the campus close to our main campus without incurring any environmental downside, and the new facilities will position the university right at the leading edge of multidisciplinary research practice worldwide," he said.
Mr Rees said that although the Sheffield complex might suggest a rivalry with Manchester, it was likely that the developments would lead to greater collaboration.
"We are not trying to operate in isolation. In areas where bio-activity is strong, such as tissue engineering, I am sure we will be collaborating with Manchester," he said.