A new unit is planned to house pediatric inpatient services, which will transfer from the city's Southmead hospital next April.
The purpose-built facility will include 16 individual cubicles and one four-bedded bay. In addition it will also include "bedside beds" for parents and a new play area.
This is the latest move which is part of the plan to centralize children's health services so that young patients need not be transferred between the two hospitals.
Maureen Betts, senior nurse at North Bristol NHS Trust, said: "Our vision for many years has been for all children's acute inpatient services to be located on a central site, to provide a more joined-up service with a single point of access.
"The promise of moving to a purpose-built unit that staff and patients have been involved in designing is very exciting."
The Department of Health will be paying for the new building, with £90,000 coming from the Wallace and Gromit Grand Appeal for art enhancement.