A UK team is building an "artificial" chromosome to be inserted into the world's first synthetic yeast.
Teams worldwide are making the other parts of its genome, which will be assembled to make the yeast strain Saccharomyces cerevisiae.
Once complete, new strains of synthetic yeast could help make products such as vaccines, biofuels and chemicals.
The UK government has announced a grant of almost £1m towards the project, which aims to be complete by 2017.
Synthetic biology involves assembling artificial genes to create new materials in a similar way that engineers build machines using many parts. Some even think it can form the basis of a new industrial revolution.
Humans have successfully learnt to control many aspects of nature, from agriculture to artificial insemination - now the emerging field of synthetic biology appears next in line to take centre stage.
The world's first living cell controlled entirely by synthetic DNA was made in 2010, but this was in a bacterial cell without a nucleus; yeast is a much more complex cell.
Like humans and plants, yeast is a eukaryotic organism that contains complex structures that store DNA within a nucleus. It was picked as it only has about 6,000 genes which makes it small compared to other more complex organisms such as plants.
Now a team around the world will make up the 16 chromosomes needed to complete the yeast genome, including researchers from the US, China and India.
Chunks of DNA will be designed by teams on computers, which will then be synthesised by specialised companies. The teams will then assemble the pieces of DNA in a sequential manner and insert them into a yeast cell, first stripping out its natural DNA.
Tom Ellis is leading the UK team with Paul Freemont, both from Imperial College London. Prof Freemont explained that building genetic structures such as chromosomes is a fundamental process for synthetic biology, where human features can be implemented into chromosomes to allow them to be manipulated.
"Yeasts have evolved over millions of years, making energy from sugars and excreting alcohol and carbon dioxide gas," he said.
"Humans have adapted these organisms to their advantage, using their by-products to make alcoholic drinks and risen baked goods.
"Now we have the opportunity to adapt yeasts further, turning them into predictable and robust hosts for manufacturing the complex products we need for modern living."
The work could help scientists gain a better understanding of human biology, Prof Freemont added.
"Yeast is a model organism we use to study cancer. It has the architecture and some of the coding regulatory systems we have. Therefore, it's a massive leap forward because these are individual chromosomes that have all the abilities to mimic the chromosomes in our own cells."
The international project is being co-ordinated by Prof Jef Boeke of John Hopkins University in Baltimore, US.
He said that once complete, it would provide "unparalleled opportunities" for asking some profound questions about biology such as: "How much genome scrambling generates a new species? How many genes can we delete from the genome and still have a healthy yeast? And how can an organism adapt its gene networks to cope with the loss of an important gene?
"Moreover, genome scrambling may find many uses in biotechnology, for example in the development of yeast that can tolerate higher ethanol levels."
David Willetts, minister for universities and science, said the work will impact important industrial sectors like life sciences and agriculture.
"This research is truly groundbreaking and pushes the boundaries of synthetic biology.
"Thanks to this investment, UK scientists will be at the centre of an international effort using yeast - which gives us everything from beer to biofuels - to provide new research techniques and unparalleled insights into genetics."