The Diamond synchrotron being built in Oxfordshire in southern England is to receive a further £120m of funding.
Diamond is being built on the Chilton-Harwell science campus
The £370m project is one of the biggest science facilities ever constructed in the UK and will use super-bright X-rays to probe the structure of matter.
Scientists say the new understanding to come out of Diamond will help them design novel medicines and hi-tech materials, among many other advances.
The funding boost has been announced by science minister Lord Sainsbury.
It comes jointly from the government, the Wellcome Trust medical charity and five of the Research Councils, the agencies which publicly fund British science.
The extra investment will allow the Oxfordshire science centre to be extended, to run many more experiments.
The Diamond Light Source synchrotron is a machine which could be described as a sort of "super microscope". It will be housed in a giant doughnut-shaped building over half a kilometre in circumference, covering the size of five football pitches.
At its heart is a ring-shaped evacuated tube that is surrounded by magnets. These bend and focus a beam of electrons travelling at close to the speed of light.
The intense ultraviolet beams and X-rays this process produces can penetrate deep into a material and reveal its internal structure.
This information helps scientists to better understand the fundamental workings of matter - such as biological tissues, polymers and catalysts - at the atomic and molecular level.
For example, if researchers can picture the precise structures of proteins - the large molecules that build and maintain our bodies - they can begin to develop ways to manipulate them; to design drugs that act on the molecules in very specific ways.
The new money announced by Lord Sainsbury will enable the development of an additional 14 experimental stations by 2012.
The individual experiments are to be done at the end of individual "beamlines".
It is envisaged that Diamond, which is sited on the Chilton-Harwell science campus, will eventually have 30 beamlines.
HOW DIAMOND WILL WORK
Electrons fired into straight accelerator, or linac
Boosted in small synchrotron and injected into storage ring
Magnets bend and focus electrons moving at near light speed
Energy lost emerges down beamlines as highly focused light at X-ray wavelengths
The science minister also had good news for the Isis facility which shares the same campus.
Isis is the world's most powerful machine for producing neutron and muon particles which can also probe the structure of matter. An extra £27.5m will be spent to increase capacity at Isis and to equip it with new high-tech instruments.
Lord Sainsbury said: "The ability to look deeper into matter is fundamental to achieving new breakthroughs in many areas from medical treatment and drugs to understanding the origins of our planet.
"This is not just about pure academic research, Diamond Light Source and Isis both provide opportunities for industrial research such as the aerospace industry, surgical tools, pharmaceuticals and cosmetics."
Into the future
Professor Gerd Materlik, the chief executive at Diamond Light Source, said: "Today's opening of the first tunnel section will allow us to start installing the machine, which marks an important step towards the completion of Diamond in 2007.
"Synchrotron light has already facilitated major breakthroughs in fields such as medicine and environmental science.
Diamond is one of the UK's biggest science projects
"Diamond will build on existing successes and provide researchers from the UK and abroad with state of the art instrumentation, cutting-edge analytical techniques and support services for the next 30 years or more."
The decision to site the synchrotron in Oxfordshire caused a major row in 2000.
Politicians from the northwest of England felt the new generation machine should have gone to an existing centre at Daresbury.
(Artist impression by JacobsGIBB Ltd/Crispin WrideArchitectural Design Studio.)