The Minister for Transport, Martin Cullen, has turned the sod on the new Arklow-Gorey bypass.
The 23km project is expected to be completed by November 2007.
The bypass, which is to cost €179 million to build, will include the construction of three junctions, 15 road bridges and one rail bridge.
Speaking at the sod turning, Mr Cullen said the new road would take up to 10,000 vehicles a day out of Gorey town centre.
The National Roads Authority Chairman, Peter Malone, said the need for the bypass was demonstrated by a 13% rise in traffic volumes on the N11 north of Gorey in the last 12 months.