Intel plans to invest $650m (about £366m) to increase output at an existing chip factory in New Mexico.
The company said it hopes the move will enable it to reduce costs and meet customer requirements more effectively.
Early next year, the world's largest chip maker plans to begin installing advanced 300mm wafer production equipment at the Rio Rancho facility, which drastically reduces the cost of a microprocessor. The company estimates it can produce more than twice as many chips on one 300mm (12in) silicon wafer than on an older 200mm (8in) wafer.
The new 300mm factories are also more environmentally friendly, the company said, using 40 percent less energy and water per chip than older technologies.
The factory addition will begin production in early 2007, creating 300 new manufacturing jobs in New Mexico.
In July, Intel announced plans to build its next 300mm factory, in Arizona. The new plant is scheduled for completion in the second half of 2007 at a cost of $3bn (about £1.7bn).