Government waste body Wrap has revealed plans to build a £12m factory capable of turning used plastic bottles into material for food packaging.
The plant, based in Dagenham in east London and operated by Closed Loop London, will stop an average of 35,000 tonnes of waste from going to landfill a year.
M&S, which currently sources all of its recycled plastic from abroad, this week became the first retailer to commit to using the facility once it opens for business in December.
"We will be able to send our own plastic waste to the plant for recycling and use more recycled plastic in M&S packaging," said M&S chief executive Stuart Rose.
M&S would be encouraging all of its suppliers to source recycled PET from the plant, he added.
Chris Dow, managing director of Closed Loop London, said: "The UK will now have a world-class facility for processing plastic waste and need not export material for reprocessing into low-grade applications."