The refurbishment and construction of the art and design building due to start in the coming months is part of the creation of a university centre for the area.
The first students should use the facility for vocational training for the creative industries in 18 months after the Skills Funding Agency agreed to back the scheme.
They will be able to follow courses in digital broadcasting for television and radio and music production and there will be a studio theatre.
College chief executive Rachel Davies said: “We’re delighted to have secured funding from the Skills Funding Agency and we have committed to funding the remainder required.
“It is a sign of our growing importance to Taunton and the wider region as a provider of first-rate further and higher education with close links to commercial partners and a commitment to employability.
“Somerset College has a strong reputation when it comes to equipping students for the world of work.
“Many of our art and design alumni have progressed to top jobs in high-profile companies - with the arts house project, we hope to build on that reputation, and equip even more people with excellent workplace skills and great prospects for the future.”
The arts house project is part of a wider development plan for the college, including establishing “an all-new university centre for Taunton and the surrounding area” teaching undergraduates from across the UK.
Director of marketing, planning and development Anthea Kerslake said: “We’re ambitious for the future, not just of our college but of Taunton and the wider region.
“We want to be at the very heart of the business community, helping to drive growth and success for the whole of the South-West.”