The project needs to raise more than £10m
A team of Bristol engineers are working on a plan to create a car capable of doing speeds of over 1,000mph.
The faster-than-sound car, dubbed the Bloodhound SSC, will attempt to break the world land speed record in 2011.
A team led by University of the West of England (UWE) professor John Piper has already spent nearly two years on designs for the Bloodhound.
The 6.5 tonne car will be powered by a Eurofighter jet engine positioned above a 400kg rocket.
The (UWE), Bristol City Council and the SS Great Britain Trust are working together to build the car on two sites - the university and a site next to the SS Great Britain in Bristol Harbourside..
The Harbourside site - dubbed The Doghouse - is next to Brunel's classic Victorian ship.
Construction of the car is due to begin in spring 2010
The driver of the record-breaking Thrust car, Wing Commander Andy Green, has been pencilled-in to drive Bloodhound during its record-breaking attempt in South Africa.
Bristol City Council's deputy leader, Simon Cook, said: "Bristol is a city renowned for its world-class creativity, design and advanced engineering and it makes perfect sense for the Bloodhound project to be based here."
The city faced tough competition from other areas of the UK wanting to host the project.
Vice Chancellor of UWE, Bristol, Steve West, added: "Regional employers and schools will benefit enormously from having such an exciting project on their doorstep.
"Hopefully we will see a few 'Brunels' emerging from the inspiration this project provides."
The project, spearheaded by former land speed record holder Richard Noble, is sponsored by more than 160 companies and individuals, but is seeking further donations.