The new Nissan model will replace the Tiida which is not sold in the UK and provide the car maker with a rival for cars such as the Ford Focus and VW Golf.
Production of the hatchback will start in 2014, and will signal an additional investment of 127 million in the Sunderland factory.
It was previously announced that the Sunderland factory will also build a new supermini that's based on the Invitation concept car at the 2012 Geneva motor show. The new supermini will be a replacement for the current Nissan Note.
Production of the two new models will create 3000 jobs within the automotive industry, according to Nissan. The car maker says 225 of these will be at the Sunderland factory, while the rest will be elsewhere in the supply chain.
The Sunderland factory will employ 6225 workers, who'll produce more than 550,000 cars a year.
Prime Minister David Cameron said: It is fantastic news that Nissan will be building their new hatchback model in the UK, and that it expects to create more jobs at the Sunderland plant and in the supply chain across the country. Nissans investment in the UK is a huge vote of confidence in the skills and flexibility of the UK workforce.
The new car will bring the number of models produced at the UK factory to five.