The 300m regeneration scheme will see the Waterdale area of the town transformed with Doncaster's first public square, a new council building, a performance venue, apartments and a possible four-star boutique hotel.
Despite originally opposing the scheme – which was signed off by his predecessor Martin Winter – Peter Davies, Mayor of Doncaster, was behind the wheel of a JCB to mark the start of building work by lifting the first bucket of soil from the site of the new civic offices.
He said: "This is a historic moment for a town with a long and distinguished history", and described the development as "the start of a new chapter for Doncaster".
"With cuts being forced on the council by the Government, the timing of a scheme that promises a new council headquarters is not ideal. However, we are where we are and must now get behind this project which has the potential to be a catalyst for stimulating growth in our economy.
"The intention is to create a destination that complements our quality shopping and market areas and encourages more visitors and business to Doncaster. I wish the project well and look forward to something really special."
Work on the new council offices is the first part of Phase One of the scheme to get under way. Building work on other first phase elements of the development, including the new performance venue, civic square, housing and a refurbished multi-storey car park, will get under way next year. All of the first phase of the scheme should then be fully open by 2013.