The distiller has signed a £900,000 package with HSBC which will allow it to build three new stills to take its production up to close to 500,000 bottles a year.
It is aiming to boost exports and double turnover over the next five to seven years.
Managing director Stephen Davies said: “The growth of the business has been constrained by a lack of production capacity rather than a lack of demand, so this investment will help us to propel the company forward.
“We have established a strong brand and business and we are now at the stage where we want to capitalise on that and look for expansion.
“Whisky is a competitive marketplace but we are fully confident we can increase sales both at home and abroad.”
Penderyn has listings for its whiskies with all the major supermarkets and its product range also includes gin, vodka and a cream liqueur.
It began distilling in 2000 and launched its first whisky four years later.