A computer game development hub will be established in Adelaide with the state government contributing $2 million towards the project that will create hundreds of jobs.
The hub will be operated by Game Plus, a collaborative workplace for developers.
"This new hub is set to create around 500 jobs in three years while positioning SA as a national leader in the rapidly growing gaming industry," Premier Jay Weatherill said.
Existing gaming company Mighty Kingdom will relocate to the new facility and the premier said it would encourage other businesses from around Australia and the world set up offices in SA.
Employment Minister Kyam Maher said Adelaide was fast becoming the best place for digital game makers to do their work.
"By establishing the games hub here in the city, we're sending a clear message to this multi-billion-dollar global industry that we are open for business," he said.
"Companies like Game Plus and Mighty Kingdom have huge projects on the go with major companies including LEGO.
