Building work at the so-called "Valleywood" film studios near Bridgend has begun.
Developers claim the studio complex will become a film centre
The first stage of the £330m development will be built at Llanilid, near Llanharan, following delays caused by sewerage problems and bad weather.
Developers said the initial phase of the Dragon International Ltd plan would feature four film stages and work on a major access road.
Construction on the first stage of the plan is set to finish by June 2008.
Oscar-winning actor and director Richard Attenborough, who has been the project chairman, said in January 2006 the scheme would "build studios that have not been seen for decades throughout the world".
Organisers claim the sound stages and TV studios will make south Wales a centre of the UK film industry.
The complex aims to bring 12 studios, including one of 30,000 sq ft and two of 20,000 sq ft, to provide facilities for recording anything from a quiz show to a big screen blockbuster.
The studios, which could create 1,700 jobs, are set to be built on the 317-acre site of a former opencast mine between Cardiff and Bridgend.
The scheme was granted outline planning permission by Rhondda Cynon Taf Council in December 2003 and includes consent for a business park, hotel and leisure facilities in addition to the film studios.
Ogmore MP Huw Irranca Davies said any spin-off developments would have to be properly served by an upgrading of the road network, including the possibility of another motorway junction.
Lord Richard Attenborough is closely involved in the project
"We have talked about the film studios but there is also potential there for a theme park or attraction that would be an all-weather, 365-days-a-year theme park," he said.
"That sort of spin-off certainly does put strain on the infrastructure but I have to give praise to Rhondda Cynon Taf Council who have taken this project by the hand all the way through and have put everything in place."
Brian Morgan, director of the Creative Leadership and Enterprise Centre at the University of Wales Institute, Cardiff, said it was good news the project was "getting off the ground"
But he warned the studios would need to offer "a very competitive product" to woo film and TV producers down from their bases in London.
Kath Ringwald from Newport Business School said the studios would also have a positive knock-on effect on the local economy.
"For one job that the studio creates we are going to be creating another one in the subsidiary industries and small businesses in Wales desperately need this kind of stimulation," she said.
"It is a great opportunity for our young graduates who are currently leaving Wales to find jobs in the creative industries. Now we can keep them in Wales."