The centre will be the company's first in Europe and the investment will be worth around €420 million.
The planned development will store videos, messages and other data from European users of the video-sharing app.
TikTok says protecting people's privacy and data will continue to be its priority.
President Trump has threatened to ban the app in the US, claiming it's a national security risk, which the Chinese owned company denies.
The building of the new centre in Ireland will mean that the data from European users will fall under the remit of the Data Protection Commissioner.
Director of Data Compliance Europe, Simon McGarr, says this will put further pressure on the underfunded commission.
"The Data Protection Commissioner put in a request for funding at the last budget. It was severely cut and that was before we had both the Schreme's ruling for the Court of Justice in Luxembourg and this new announcement from TikTok, which can only increase the amount of work that the DPC can do and therefore the amount of resources that have to be paid for.
"If the Government does not resource the regulator, the regulator isn't going to have the resources it needs to do its job."