The media mogul first began developing a format based around DJs more than two years ago, calling them ''the new rock stars''.
Cowell has now announced that he had teamed up with live event and digital entertainment producer SFX for the show, Ultimate DJ.
TV plans for the show are yet to be announced.
The Britain's Got Talent judge said: "We have been developing this concept for a while but our partnership with SFX has been a real game-changer for this format.
"It made complete sense for us to collaborate with SFX with their access to the best up-and-coming DJs and their great marketing platform to build new DJ talent."
A press release about the show said: "Launching initially online, the music event competition will feature producer-challenges where DJs will be invited to submit recordings for fan voting via social media.
"From there, the competition will move on to live challenges and performances in SFX event venues".
Kelly Belledegrun, senior producer at Cowell's company Syco, said: "This show will represent a visual and musical revolution and we can't wait to showcase this to the world".
The announcement comes as Cowell prepares to make his return to the X Factor later this year following a ratings slide for the UK show.
It was announced at the weekend that X Factor musical I Can't Sing!, which Cowell co-produced, is closing due to poor ticket sales.
Cowell's ITV shows Red Or Black and Food Glorious Food failed to become ratings hits.