Rails of Sheffield is opening new premises within the next six months after buying land in Dronfield.
The business has long been based at a shop on Chesterfield Road in Heeley, which is staying open.
The new roles will be in retail, international trade, sales and administration.
Adam Davies, operations director at Rails of Sheffield, said: “With so much usable space over two floors, this development will allow us to continue growing as one of Europe’s largest model railway retailers. We can’t wait to move in over the coming months.”
Rails of Sheffield was launched in 1970 by Hedley Barber in the back of a grocery shop. Since its move to Chesterfield Road it has expanded into larger premises. Today it employs 30 people and is run by Hedley’s son and grandchildren.
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HSBC lent the money.