The shop is the third branch of Fancie to be opened by Sheffield-based entrepreneur Amanda Perry, who established her first cupcake shop and tea room in Sharrowvale Road in 2008.
Ms Perry said: "I am really looking forward to opening our new store today. It's exciting times for Fancie and we are continuing to grow year on year.
"We have a strong student following so it's great to be able to take Fancie to the students' union where we'll not only be easily accessible to students and university staff, but also to the hospitals and businesses in the surrounding area."
The new branch will be open Monday to Friday from 10am to 4pm, selling 14 flavours of cupcake including "Snickerlicious", "Red Velvet" and "Pink Marshmallow."
Former pastry chef Ms Perry founded Fancie two years ago, baking cakes in the kitchen of her home in Wadsley Bridge.
However, the business took off rapidly and, since then, the baking has moved to a professional kitchen in Edgedale Road.
Fancie currently sells about 2,000 cupcakes a week from its branches in Sharrowvale Road and the Winter Garden and plans are also well afoot for the
opening of a fourth branch in Sheffield.
Ms Perry added: "The business has been steadily growing since opening in 2008.
"I have been pleasantly surprised at how successful Fancie has become and I am excited about the times ahead. Everyone deserves a treat and the Fancie experience is definitely that."