Network Rail has identified a site in Sandwell to build the new factory, which will produce up to 600,000 sleepers per year once built.
The facility, which will secure up to 100 jobs, will account for 60% of Britain's concrete sleeper supply, with another factory in Doncaster providing the remaining 40%.
The proposed site will be directly connected to the rail network making it quicker and easier for transport.
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A 15-year contract to manufacture concrete railway sleepers will be awarded in spring this year.
Martin Frobisher, route managing director of Network Rail's London and North Western route, said: "Network Rail remains committed to the West Midlands economy which is why Bescot has been identified as our preferred location for the new factory that will retain the bulk of our sleeper manufacturing presence in the region.
"Bescot is ideally placed at the heart of the rail network to provide sleepers across Britain. We are in discussion with the local council to carry out an environmental assessment of the proposed factory and its impact on the surrounding area before we fully consult with local people and stakeholders on our plans."
(LM/JP)
