Newport has fought a hard campaign for city status
The south Wales town has beaten off competition from five other Welsh rivals for the accolade.
The prize of city status was on offer in a competition to mark the Queen's Golden Jubilee in 2002, with winners also to be named in England, Scotland and Northern Ireland.
However, the decision is likely to be controversial, as three of the four existing Welsh cities - Cardiff, Swansea and the small cathedral city St David's - are in the south.
The fourth city in Wales, Bangor, is the only one in the north of the country
The award, together with other successful cities around the UK, will be announced by the Lord Chancellor Lord Irvine on Thursday morning.
Civic boost
The accolade which comes at the third time of asking after two unsuccessful bids in the 1990s is mainly prestigious, but civic leaders in Newport hope it will help boost the economy.
"Newport had claims that were just undeniable," said Newport East AM John Griffiths, adding civic leaders will have new strengths in being able to market the town as a city.
The town has suffered a series of major factory closures and redundancies, including last year's decision by Corus to close part of the giant Llanwern steelworks.
However, Newport has been put on the map by its victory in the battle to stage the 2010 Ryder Cup golf tournament, at the nearby Celtic Manor Resort.
The town has also won fame as a major centre for the new wave of Welsh rock and pop music.
The Queen will visit the city as part of her Golden Jubilee tour of Wales in June.
The decision to nominate Newport was that of Welsh Secretary Paul Murphy.
He decided on the competition for a Golden Jubilee city after Wales missed out in the round of Millennium nominees.
It is understood Newport was successful in its bid because it fits the criteria of a town with regional or national significance, and a forward-looking attitude.
The news will come as a disappointment for the rival towns of Aberystwyth, Machynlleth, Newtown, St Asaph, and Wrexham.
All six contenders had previously failed in an earlier contest for city status, held as part of the Millennium celebrations.
Despite their hopes no new Welsh city was created to celebrate the year 2000.
Two English applicants - Wolverhampton and a joint bid from Brighton & Hove- were chosen along with Inverness in Scotland.