DeepSeek Plans to Build 1GW Ultra-Large-Scale AI Data Center in Inner Mongolia
N.R. Finch
DeepSeek is planning a 1GW AI data center in Ulanqab, Inner Mongolia — China's largest single-site AI compute facility to date — with partial capacity targeted for late 2027.
Why Ulanqab, Inner Mongolia?
Ulanqab sits roughly 350 km northwest of Beijing, with an average annual temperature of just 4°C.
This means → the natural cold cuts AI server cooling costs significantly; the site choice itself is an energy bill decision.
Over ten companies, including China Mobile, have already planned data center projects in the city — a cluster is forming.
How does DeepSeek plan to build it?
The company will build new facilities while also leasing extra capacity from other providers — a dual-track approach.
The target: bring at least part of the campus online by late 2027 or early 2028.
A DeepSeek job listing already references a "gigawatt-scale campus," with roles based in Hangzhou, Beijing, or Inner Mongolia — confirming the expansion intent.
Where will the chips come from? The biggest open question
Nvidia GPUs are the industry standard, but U.S. export controls have effectively blocked the latest-generation chips from sale to China.
Huawei is the leading domestic AI chip supplier, but whether it can meet 1GW-scale demand remains unclear.
In plain terms = DeepSeek wants to build China's largest AI compute factory, but the supply of its most critical component is still a question mark.
The Trump administration previously alleged that a DeepSeek data center in Inner Mongolia used Nvidia Blackwell processors in violation of export controls.
Is 1GW big? How does it compare to the U.S.?
1GW dwarfs every operational AI data center in China — it is the largest single-site plan in the country.
But top U.S. firms are planning even larger: OpenAI and Anthropic have outlined 3GW and 5GW projects respectively.
This reflects a multi-fold gap in AI infrastructure between China and the U.S. — though China's pace of catch-up is accelerating.
Another Chinese AI company, Zhipu (Z.AI), is also advancing a 1GW project — and plans to use entirely domestic chips.
What does a 1GW data center cost?
Nvidia CEO Jensen Huang has estimated that a 1GW data center equipped with cutting-edge AI chips costs roughly $50 billion.
Actual costs vary widely by location and chip choice; Chinese construction costs are typically far lower than U.S. equivalents.
In plain terms = $50 billion is the ceiling reference price; DeepSeek's actual spend could be significantly below that figure.
Where does DeepSeek stand today?
Founded by Liang Wenfeng and headquartered in Hangzhou, DeepSeek shook the tech industry last year with frontier AI models that used far less compute than rivals.
The company has raised $7 billion, is valued at roughly $50 billion, and has begun IPO preparations — a filing could come as early as this year.
This means → massive compute expansion and an IPO push are running in parallel; DeepSeek is shifting from "tech dark horse" to infrastructure-scale player.
Content is for reference only, not financial advice.