US-owned warehouse retailer Costco will build its second Melbourne store at Ringwood, in the city's outer east.
Around 400 people are expected to be employed at the store, which is scheduled to open in the second half of 2013.
In addition, about 100 direct jobs would be created during construction.
Costco managing director Patrick Noone said the store would serve about 1.5 million customers in the city's eastern suburbs.
Noone said he was confident the bulk-buying options, branded merchandise and membership benefits that had drawn 100,000 members to the company's flagship Docklands store, would be well-received at the 14,500 square metre Ringwood development.
It will be Costco's fourth Australian store, and while Noone said the company did not have a target number of stores, it hoped to open more in Melbourne and Sydney, where it has one store, and expand into Brisbane and Adelaide.