The £23 million scheme, which will include a seven-screen cinema and five retail and leisure units plus a 226-space car park, is set to be completed in late summer 2023 and opened in the autumn of that year.
It is estimated the construction of Pioneer Place will support around 180 jobs, with a further 100+ new jobs being created in the cinema and supporting food outlets.
The work will be carried out by the council's development partner Maple Grove Developments, part of the Eric Wright Group.
Pioneer Place has secured funding from Burnley Borough Council and Lancashire County Council, the Government’s Getting Building Fund administered by Lancashire Enterprise Partnership (LEP), and fashion company and the borough’s largest employer boohoo.
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Burnley Borough Council leader Councillor Afrasiab Anwar said: "It's fantastic to see this major project get underway. Burnley Borough Council has been determined to forge ahead with this exciting and ambitious project and now it is becoming a reality.
"Pioneer Place will bring new visitors to Burnley town centre during the day and into the evening, deliver new jobs and support the growth of the rapidly expanding UCLan campus. It will help diversify what the town centre has to offer to local residents and visitors alike and help boost the local economy."
Nik Puttnam, senior development manager at Maple Grove Developments, said: "The partnership with Burnley Borough Council has overcome a great number of challenges to reach this point and the project team must be congratulated for their unwavering commitment to the scheme and to the continued regeneration of Burnley town centre.
"With the start of construction now underway, our vision to create a leisure quarter which will diversify the evening economy here in Burnley is finally being realised and we look forward to completing the development in early autumn 2023."
The multi-screen cinema will be operated by REEL Cinemas which will continue to operate from its current site in Manchester Road, Burnley, until it moves to Pioneer Place. The Manchester Road site will then be redeveloped for occupation by supermarket chain Lidl. The adjoining Star pub will remain unaffected.
