SWANSEA University and computer giant HP are to launch a three-year development programme, investigating smart cities.
The project will carry out research into how developments like community-wide wifi internet connections, new computing technology, infrastructure and the use of sensors which collect information on everything from parking spaces to the weather can all work together in the city of the future.
Professor Javier Bonet, head of the university's College of Engineering and the programme's strategic director, welcomed the joint project.
"Working with global enterprises like HP as well as academia and local small and medium businesses is a fundamental part of ensuring a sustainable community.
"This programme will have direct economic benefits for Wales in terms of knowledge creation, innovation and exploitation, as well as the development of a highly-skilled workforce."
Over the next three years, the project will examine the roles of smart metering, situational awareness, data analytics and security threat detection in the cities of the future. The first phase will look at the Welsh Government's intention to reduce greenhouse gas emissions by 80% before 2050.
Much of the new work with HP is expected to be carried out at the university's Bay Campus, which is currently being built on land off Fabian Way.