The 70,000 sq ft factory, which will open next summer at Five Crosses industrial estate in Minera, Wrexham, will have a capacity of 100 million litres four times that offered by Tomlinson's current 25 million-litre Wrexham site.
It will initially provide 50 million litres, with the capacity of the plant gradually increasing over subsequent years.
Owner Philip Tomlinson said the company's expansion had been driven by growing consumer interest in Welsh milk.
The new facility would enable Tomlinson's to continue to source Welsh milk and process it locally, he added. "We are committed to supporting the local economy and farming community."