The brewery, based in Kilcock, County Kildare, believes the plan will create 100 new jobs within the company, and a further 150 during the construction process.
When completed, Rye River will be the largest independent brewery in Ireland.
There are now more than 50 micro-breweries operating in Ireland.
The country’s craft beer output has nearly doubled in the last two years, expanding from 37,000 hl in 2012 to 71,000 hl in 2014.
The growth of the sector has been encouraged by the government, which raised the production ceiling on excise relief by 50% in its 2015 Budget.
Rye River was launched in November 2013 by Niall Phelan, Alan Wolfe and Tom Cronin. It now employs 54 people and turned over €5.5m in 2014, its first full year of operation.
Rye River also produces own-label beers for Lidl and Tesco and distributes the Bavaria and San Miguel brands in Ireland, as well as Denmark’s Coisbo and Scotland’s Innis & Gunn.
Co-founder Niall Phelan said: “This is a really exciting time for The Rye River Brewing Company as we reach this significant milestone in our expansion and development and we have strong plans and targets now in place to increase production to meet our growing export markets.
“Our production capability will treble to seven million litres from the current two million litres as we have outgrown our current brewery, and importantly the investment will help us maintain the quality of our award winning Irish craft beers that have helped to drive our expansion abroad.”