Sunderland University has secured a deal with local development agency One North East to launch a software research and development programme aimed at creating up to 50 high-tech graduate positions.
The ??3m Sunderland Software City (SSC) education and innovation programme plans to provide a 'software hatchery' for enterprising businesses to develop ideas in a financially supportive environment.
The university aims not only to develop new ideas with budding entrepreneurs but also to assist up to 120 businesses looking to recruit graduate talent.
One North East's Lesley Calder told the Northern Echo: "Demand for graduates in computing remains strong and businesses are increasingly reliant on top ICT talent.
"Our support will help Sunderland Software City establish an education sector providing exceptional technical and business expertise and an infrastructure to meet the growing demands of the industry."