The budget chain is opening at Heeley Retail Park off Chesterfield Road on Saturday March 12, creating 18 jobs.
It is taking the lease on units 2A and 2B, formerly occupied by Bargain Buys and Poundstretcher.
They have been converted into a single 12,500 sq ft unit which is more than twice the size of a typical 6,000 sq ft Poundland, bosses say.
It will sell clothes, homeware and chilled and frozen food.
A spokesman said: “As one of the largest stores in the portfolio, it will have belted checkouts, like those in supermarket, for maximum convenience.”
A second new store - also larger than normal - is due to open in April, the company says.
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It comes after The Star revealed discount supermarket Lidl plans to open two stores in Sheffield city centre.
Poundland’s retail and transformation director, Austin Cooke, said: “Sheffield is one of the UK’s great cities and one where we’ve built up a tremendous relationship with our customers.
“Sheffield Heeley Retail Park and the other new Sheffield store will be a great addition to our network of stores in the city and across Yorkshire.
“They’re both large stores and they’ve been carefully designed so that customers will see Poundland at its best.”
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Some of the new jobs will go to former Fultons Foods staff in Sheffield, he added.
Poundland acquired the frozen food specialist in October 2020 and converted 11 into either Poundland or PEP&CO clothing and homeware shops.
Last month it said all stores yet to be rebranded would close.
Following the acquisition and an investment of £25m, Poundland now sells chilled and frozen food in more than 250 stores, set to rise to more than 500 over the next two years, it says.
The company has six shops in Sheffield: Angel Street, the Moor, Castle Square, Hillsborough Barracks shopping centre, Manor Top and Meadowhall. It has 850 in the UK and Republic of Ireland and employs 18,000 who serve 7m customers a week.
It is part of the Pepco Group which had 3,363 stores across Europe as of 30 June 2021.