With a detailed planning application expected to be submitted in the next few weeks, work could start on the £40 million facility as early as this summer.
The centre will draw its energy from the large biomass plant at nearby Markinch.
If it goes ahead, the "green" development at the Queensway business park will create up to 250 construction jobs.
Once the centre is up and running next year it will be staffed by 50 full-time skilled technology and engineering workers. A delighted Fife council deputy leader Lesley Laird said: "News of this development for Glenrothes is particularly welcome, not only in terms of the employment opportunities it will bring, but in enhancing the council's plans to regenerate the entire estate.
"Officers in the Invest in Fife team and Scottish Development International have worked closely with the company over the past 12 months or so to help identify the best location."
Queensway Data Centre will host up to 1500 computer racks.
Scottish Enterprise is keen to attract data centres to Scotland, given predictions that the sector could create 58,000 jobs over the next few years.