The Hydro, which has been built next to the Scottish Exhibition and Conference Centre (SECC) in Glasgow, beamed out shades of blue, green and purple from its external walls.
Rocker Rod Stewart is due to perform the opening concert at the venue on Monday, when members of the public will be welcomed inside for the first time.
It will be used for concerts and other live shows, and will seat 13,000 people, making it the largest purpose-built indoor arena in the country.
Around 140 events will be hosted in the venue every year and it aims to be one of the world's top five busiest indoor arenas.
The SSE Hydro has been designed by architects Foster & Partners.
At present the SECC stages 70 event nights a year but that figure will be doubled when the Hydro opens.
A spokesman said: "The SSE Hydro is going to have a huge impact on Glasgow's economy.
"The current economic impact of the SECC is £397million a year and the Hydro has the potential to inject an additional £131m a year into the local economy.
"This economic impact will undoubtedly have a knock-on effect on the local economy and local business.
"The O2 Arena has seen an extra £400m flood into London and we have high expectations that the Hydro will work just as hard for the city."
City council leader Gordon Matheson believes the opening of The SSE Hydro will be a landmark occasion and will cement Glasgow's reputation as an international destination for a wide range of events.
He said: "It is truly another key stage for Glasgow in our development as a city renowned as a great place for concerts and conferences, and is a stunning new addition to our skyline.
"We can all look forward to welcoming many of the world's greatest entertainers and performers to this state of the art venue in the coming decades.
"A phenomenal number of visitors will come through the doors of The SSE Hydro, bringing a huge economic impact.
"It is estimated this new asset for the city will host around 140 events every year and many of these people will stay in the city to use our restaurants, pubs, clubs and hotels before and after a visit to the venue.
"To underline the point, The SSE Hydro will now join the very top rank of global venues - alongside the likes of Madison Square Gardens and the O2 Arena - and will be as busy as any of these.
"Of course, The SSE Hydro will be one of the city's venues for the Glasgow 2014 Commonwealth Games, and I am sure our visitors next summer will be impressed by such a magnificent arena."
The Hydro will be the base for artistic gymnastics, rhythmic gymnastics and the boxing finals.
Mr Matheson added: "Our newest venue will play a major role for Glasgow in the coming decades, attracting concerts, conferences and events of a standing matched by very few venues, even on an international scale."
Chamber of Commerce chief executive Stuart Patrick said the Hydro will be one of the most important investments made in Glasgow this decade and will be a substantial earner for the city.
He added: "For every £1 of visitor spend at the arena, they will spend another £3 in Glasgow's hotels, bars, restaurants, shops and taxis during their stay or night out.
"The Hydro, with its 12,000 seats, will be in the top five busiest indoor entertainment arenas in the world, alongside such venues as Madison Square Garden in New York and The O2 in London.
"Its availability for performances by top international artists will also free up much needed dates in the SECC for major conferences. The SECC was never meant to be a concert venue.
"Conferences attract high-spending delegates and have huge benefits for businesses throughout the supply chain, including food suppliers, the hospitality trade, distribution companies and transport providers.
"The Hydro's presence will allow more of the larger conferences to take place and add to the city's reputation as a convention capital."