Golwg and Golwg Newydd will employ nine new members of staff
An independent Welsh language news and current affairs website is being launched by Heritage Minister Alun Ffred Jones.
Golwg360 will feature a rolling news service and will give businesses, public bodies and individuals the chance to set up their own micro-sites.
It is being run by Golwg Newydd, the sister company of Golwg which publishes a weekly Welsh language magazine.
The assembly government is giving the site £200,000 annually for three years.
The money had originally been earmarked for developing the Welsh language press.
But plans for Y Byd, a Welsh daily newspaper, were abandoned last year amid claims the assembly government had not provided enough financial support.
The two companies are employing nine new members of staff including four full-time journalists and others on freelance contracts.
The magazine is also being developed further with extra pages and new columns and features.
Among the organisations and individuals to have already taken up their own pages on Golwg360 are the Scarlets rugby region, S4C and a variety of Welsh artists.
A full news service will be available from the beginning and other features will be added regularly based on audience feedback.
"This is an important development for Golwg and the Welsh press and, hopefully, for the Welsh language itself," said Golwg Newydd's chairman, Gwynfryn Evans.
"During an economic crisis, it's great to see an historic new service being launched."
Alun Ffred Jones said the launch of the new service was a "very exciting day for Welsh-language journalism" and was "an important investment for the future".
"The assembly government supports the strengthening of journalism provision through the medium of Welsh," he said.
Gwerfyl Pierce Jones, the director of the Welsh Books Council, who is administrating the new grant on behalf of the assembly government, said there had been fierce competition for the tender.
"It was an application by Golwg which was successful, and that was because they offered an attractive and comprehensive package, which consisted of an online news service (and much more) as well as plans to refresh the print magazine, Golwg," he said.
Golwg has offices in Lampeter, Caernarfon and Cardiff.