The government has approved plans for a £20m "super school" on Tyneside.
Lord Irvine Laidlaw is sponsoring the new academy
Excelsior Academy will be built on land off Norland Road, in Scotswood, Newcastle and is due to open in September 2008.
Lord Irvine Laidlaw, is sponsoring the academy, which will replace West Gate Community College.
Public services union Unison has expressed concerns about the plans because of fears about private investment in education.
Councillor Nick Cott, executive member for children and young people at Newcastle City Council, said: "This is a major milestone in the development of the academy.
"The academy will bring exciting new educational opportunities for young people in the west end of Newcastle.
"The council has worked closely with the government, the sponsor and the local community to ensure that the new academy will meet local needs and enable young people to achieve higher levels of success."
Lord Laidlaw, who is providing £2m for the academy, said: "I am very pleased that the agreement has been approved, which means we can now move on to the next phase of the academy development."
"The academy team look forward to continuing the partnership with Newcastle City Council, West Gate Community College and the local community."
But Unison claims that the move is about privatising education against the wishes of local communities.
Kenny Bell, Unison Branch Secretary for Newcastle City Council, said: "The government are adamant that academies are going to go ahead.
"West Gate Community College is an improving school that's going to be needlessly closed for the academy to go ahead.
"It's about privatising education, however the government explains it."