More than 320 jobs are expected be created when NSW's second largest Ikea store opens next June in Marsden Park, Premier Barry O'Farrell said.
Mr O'Farrell performed the ground-breaking ceremony of the multi-million-dollar store on Hollingsworth Road at Sydney Business Park last week.
The 28,500-square-metre store will be near Bunnings, Masters, Costco, McDonald's and Shell, fronting Richmond Road just off the M7.
"Ikea says the new store will boost the local economy," he said. "This expansion is a massive vote of confidence in the economy of Western Sydney."
Ikea Australia manager David Hood said he was thrilled work had started on the development, the third Ikea store in Sydney. "With new homes being developed in the area and an increasing number of families moving in this new store is an important step in Ikea making its range of affordable, well-designed home furnishing products available to as many people as possible," he said.
"Ikea is seeing a great deal of growth in the Australian market and this is just the first of our longer-term national expansion plans."
The store will have 5753 square metres of showroom, 5750 square metres of markethall, a 450-seat Ikea restaurant, a staffed children's play facility for 45 children and 850 car parking spaces.
It is due to open in June 2015 after a 15-month build time.