The chain started with a market stall in Wakefield set up by Christopher Edwards in 1974.
Construction is due to start in the summer on a 30-acre (12 ha) site at Normanton, near junction 31 of the M62.
It is part of a plan to create about 3,500 jobs with a nationwide expansion of 200 stores over the same period.
The firm, which is based at Normanton, currently has more than 280 outlets, as well as 50 Bargain Buys shops. It employs more than 6,000 people.
The new distribution centre should be completed in autumn 2016, the retailer said.
The discount retailer Poundworld is to open a new distribution centre in West Yorkshire creating more than 300 jobs in the next three years, it has said.