Hagrid's hideaway is perched 3,000ft up a mountain in Glencoe. The set will also include the gatehouse to Harry's school, Hogwarts.
The Sunday Mirror newspaper also says 400 cast and crew members will be moving to Glencoe for the filming.
Potter 3 started shooting in February.
Old faves - including Daniel Radcliffe as Harry and Robbie Coltrane as Hagrid - have been joined by loads of new stars, including Gary Oldman as Sirius Black.
There have already been a few hiccups with the shoot. A fire in the Highlands halted filming and then some of the crew threatened to go on strike.
But everything's been sorted out now and Hagrid's hideaway will soon take shape.
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