Warner Bros plans to expand production capacity at its Leavesden studios near London by more than 50 per cent, becoming the home of DC Studios.
The move will add 10 new sound stages to the studios where much of the Barbie blockbuster and HBO's House of the Dragon were filmed.
The film company was also behind the Harry Potter film franchise and its fan tours are a significant tourist attraction.
The entertainment company said an additional 37,000 square metres of production and support space would be created.
The project is expected to create 4,000 “direct or indirect” jobs across Britain and grow Leavesdon's contribution to the UK economy by “more than £200 million”, Warner Bros Discovery said.
Ground breaking on the project is set to begin next year, with the expansion scheduled for completion in 2027.
Chancellor Jeremy Hunt described the investment in the site as a “huge vote of confidence in the UK”.
“The enormous strength of our creative industries sees films and television shows made in the UK reaching cinemas and front rooms across the world, including Barbie and the House Of The Dragon series,” he said.
“Warner Bros Discovery’s ambitious plan to grow its Leavesden studio is a huge vote of confidence in the UK – creating thousands of jobs and growing our economy – and means that British-made entertainment will continue to delight and entertain global audiences.
“The UK ambition is to be the world's next Silicon Valley, and we think we're already Europe's technology and entertainment hub. And this is another step towards that.”
Simon Robinson, chief operating officer of Warner Bros Discovery Studios said the studios were globally recognised for their exceptional sound stages and facilities.
“With this planned expansion adding significant capacity and capabilities, it will be home to even more incredible storytelling for both film and television projects,” he said.
“We are proud to not only be growing our productions in Leavesden and making it the main hub for DC Studios, but also to be growing our economic and community contributions to the UK’s creative sector.”
The investment comes as Warner Bros Discovery's California production has been hit with the first joint writers' and actors' strikes in 63 years, delaying major projects and prompting it to slash revenue forecasts for the rest of this year.