The Welsh Government is to invest £3 million in the expansion, which will be developed next to the main hospice building at Blackett Avenue.
The new 15 bed unit will replace a smaller 10 bed unit at St. Anne's Hospice, which opened in 1979. The existing unit cares for over 3,000 patients and their families each year.
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The hospice cares for patients with cancer and other life-limiting illnesses, such motor neurone disease and end-stage heart failure.
The existing building (St. Anne's) is leased by St. David’s Hospice Care until 2018 when the lease expires.
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