Work is starting on a £3.8 million upgrade of fertility services and stem cell research facilities.
The aim is to make the North East a leading centre for stem cell research
The investment at the Centre for Life, in Newcastle, will include laboratories which are purpose-designed for stem cell research.
It is part of a project aimed at making the north-east of England one of the top 10 centres for stem cell research in the world by 2010.
In 2004, the government announced Newcastle would become a science city.
The project is being led by the Institute of Stem Cell Biology and Regenerative Medicine, which is a partnership of regional development agency One NorthEast, Newcastle and Durham Universities, Newcastle upon Tyne Hospitals NHS Trust and the Centre for Life.
The new facilities will allow a £9.8m science city grant from One NorthEast to be brought into use at the earliest possible date.
Details of the grant were announced in December last year and the money will be used to create two facilities which will mean stem cells can be produced of sufficient quality to be used on patients for therapeutic purposes.