Education Minister Chris Hipkins said Te Pā Wānanga o Tuteremoana would provide education at primary and secondary levels, embedded with Muaūpokotanga.
The Government has given the green light for a new Māori school to be built in Levin.
The plan was for Te Pā Wānanga o Tuteremoana, a new wharekura for Years 1 to 13, to be open within three years.
Te Waipupūtanga o Punahau komiti member Milly Paea said itwas the realisation of a dream after some hard mahi behind the scenes.
Paea said Muaūpoko Whānau committee Te Waipupūtanga o Punahau had worked with the Ministry of Education, Muaūpoko Tribal Authority, whānau, nearby schools and kura, local council, and other stakeholders in the region for a number of years.
"This milestone is the result of intergenerational work. Our mahi is tipuna led. We acknowledge our kuia and kaumātua who worked tirelessly on this kaupapa for many many years," she said.
"Of course, many of them are no longer with us, we feel their presence and their blessings today. We embrace the dreams they held for a better future for our tamariki and our people.
"The journey is just beginning with Te Pā Wānanga o Tuteremoana which is set to open in 2025. Our whānau tell us they are 'hanging out and cannot wait'."
Muaūpoko Tribal Authority chairman Tim Tukapua said the news of "huge" for Muaūpoko.
Muaūpoko Tribal Authority (MTA) Inc is the mandated representative organisation for Muaūpoko Iwi. MTA had worked closely with the whānau organising committee to support them to ensure Muaūpokotanga is preserved and protected, he said.
"We congratulate Te Waipupūtanga o Punahau and all the whānau. This will have an incredible impact on the future of our people - iwi, hapū, whānau and all our tamariki and rangatahi," he said.
"Te Pā Wananga o Tuteremoana recognises our history as well as the many links that bind us to, and with other peoples. This is huge for Muaūpoko.
"To provide the environment for our mokopuna to thrive, to fulfil their unlimited potential is a long-held dream. Being strong, being confident and being steeped in who they are as Muaūpoko, connecting with their Muaūpokotanga.
"It's just beautiful. Today is a major celebration for Muaūpoko."
The business case process was whānau led and owned over the last five years. This would continue. The whānau and MTA look forward to working with ministry officials over the coming months to appoint the establishment board to drive the process to opening in 2025, he said.
Education Minister Chris Hipkins said the establishment of Te Pā Wānanga o Tuteremoana will mean up to 250 tamariki and rangatahi can attend a Māori medium school locally, instead of having to travel to Ōtaki.
"This is a major step forward in the development of our Māori Medium Network, given around 40 per cent of ākonga in the Horowhenua identify as Māori," he said.
"I would like to acknowledge the Muaūpoko whānau roopu for their dedication in seeking the establishment of this designated character school."
Hipkins said Te Pā Wānanga o Tuteremoana will provide education at primary and secondary levels, embedded with Muaūpokotanga , which embraces language, history, traditions, tikanga, values, beliefs, stories, knowledge and the natural environment.
Consulation over the past year has involved 21 local schools and kura, along with Ngā Kura ā Iwi o Aotearoa and other sector bodies.
"The next steps are to investigate a site for the new wharekura and appoint an estblishment board and tumuaki to oversee it development. The kura is set to open in three years time," he said.