The 5,500 square metres Metropolitan Arts Centre (MAC) will be built in the city's Cathedral Quarter and create 420 construction jobs.
Northern Ireland's Department of Arts and Department for Social Department have backed the project, which is due for completion by early 2012.
The six-storey building will house two theatres, three visual art galleries, dance studios, rehearsal rooms, offices and a bar restaurant.
Arts Minister Nelson McCausland has pledged £10.76m towards the two year construction project.
"The aim is to provide a building which will create entertainment, promote education and inspire creativity," he said.
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"This project is another example of devolution delivering for local people."
Bowen Mascott, a joint venture between two building firms from Cork and Newry, has been awarded the contract.
MAC chairman Joris Minne said the centre will help reignite the regeneration of the city centre's Cathedral Quarter.
"Most importantly, it is at the heart of the economic regeneration programme for Belfast’s city centre," he said.
Over £5.25m has been committed towards the project by the Arts Council.
Its chief executive, Roisin McDonough, said the centre will provide an "essential ingredient" to the regeneration of Belfast.
Social Development Minister Margaret Richie said the announcement coincides with progress on the Royal Exchange regeneration scheme.
Developers must outline their plans for this project by October next year.
"We now have in sight the realisation of the vision of so many in building a hub for arts and culture at the heart of Belfast," said Ms Ritchie.
The MAC's architects are Belfast-based Hackett Hall McKnight, who won the competition to design the arts centre amidst a field of 100 architectural firms from around the world.
(PR/KMcA)
