SkyCity has received approval from the Overseas Investment Office to buy an undeveloped block of land for $16 million.
The plan is to develop a five-star hotel at the lakefront section on Frankton Road.
The company had long planned to expand in Queenstown and approval from the OIO means plans can progress.
Back in May SkyCity revealed its intentions to buy a section of land at a Macquarie Investment hearing in Sydney, although at the time the specific site was unconfirmed.
SkyCity currently operates two casinos in Queenstown, the SkyCity Queenstown Casino and the SkyCity Wharf Casino.