The craft brewer, headed by former Molson Coors sales chief Paul Miller, has built a microdistillery at its Guardbridge base.
The expansion means Eden will house Scotland's only combined brewery and distillery, and restore whisky-making to a site for the first time in more than 150 years.
The Haig family produced grain whisky at the site between 1810 and 1860, when it was then known as the Seggie distillery. Their brand was later sold to Diageo.
Mr Miller said the first batch of Eden Mill whisky would be distilled in September, with the spirit then matured in casks of different sizes — from octaves to sherry butts —made from different wood.
With the emphasis on small-batch production, he said the distillery would produce only eight to ten regular barrels of whisky per week.
Mr Miller, who set up Eden with a silent partner in 2012, said: "It is not going to be mass market stuff, far from it. It will be bespoke. We will do a mixture of the different cask types, from quarter casks right through to hogsheads."
The first whisky to be released by Eden Distillery will be a blended malt, however.
Based on seven malts from distilleries around Scotland, it is currently being matured and "married" in Eden's own barrels. The casks are made from wood types such as French oak, American virgin oak and Port wood.
Mr Miller said: "We've identified seven distilleries which we think can produce the best blended malt that we can make.
"What we are doing is finishing that in some unique casks at the distillery just now, so that in the late autumn we are likely to have a whisky that we have married and matured at our distillery, albeit we haven't made it at our distillery."
The whisky will be available on a limited basis from October or early November, with sales geared towards local hotels, bars and restaurants, as well as visitors.
Mr Miller added: "It will be really limited-release stuff that will have an interest value. It will have St Andrews' name on it [with] elements of it produced here. That's what most people want to walk away with — something that genuinely has an element of local provenance in it."
Part of the rationale behind bringing out the blended malt is so Eden avoids having to pre-sell too many of the casks of whisky it will make at the distillery.
Some 30 of the barrels made in the first year will be made available for individuals, who can watch the whisky being made, choose the wood for its maturation, and attach their name to it.
Mr Miller anticipates selling this whisky in quarter casks or octaves, which people can leave to mature for four or five years.
Eden, which will take delivery of three stills on August 23, will also use the distillery to make small batches of gin. It has been working with the Strathearn Distillery on recipe development, along with St Andrews Botanic Gardens, whose experts have helped it forage for ingredients.
The intention is to release a range of seasonal spirits under the Eden Gin name, based on different botanicals which are available at different times of the year. The first batch is due to be released in September, when the spirit is likely to be sold in local bars, restaurants and hotels.
Mr Miller said: "Like the whisky, this is going to be small-batch, authentic, locally-produced gin — we're not intending on producing a huge-scale brand.
"It is designed to encourage people to engage with the gin category which we think is a really exciting area, Scottish gin in particular.
"We are trying to educate and engage people and maybe demystify the world of gin. People can come here and we will show them how gin is properly made in a proper distillery. And we will explain a little bit about our gin and the gins that are out there."
Eden currently employs seven staff and said the investment would take its headcount up to 20 staff within two years.
Its distillery will open as the Wemyss family puts the finishing touches to its new Kingsbarns Distillery further along the Fife coast. Mr Miller feels the two will complement each other well, and help attract whisky lovers to the area.