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Area Development - Site Selection, Facility Planning and Workforce Development

xAI Plans Southaven, Mississippi, Data Center Operations

01/14/2026
Artificial intelligence company xAI plans to establish data center operations in Southaven, Mississippi.

The $20 billion project will include the purchase and retrofit of an existing building and will increase the company’s computing power to nearly 2 gigawatts. Operations are scheduled to begin in February 2026.

“xAI is scaling at an immeasurable pace — we are building our third massive data center in the greater Memphis area. MACROHARDRR pushes our Colossus training computer to ~2GW – by far the most powerful AI system on Earth. This is insane execution speed by xAI and the state of Mississippi. We are grateful to Governor Reeves for his support of building xAI at warp speed,” xAI CEO Elon Musk said.

To support the project the Mississippi Development Authority (MDA) has approved xAI for its Data Center Incentive, which provides a sales and use tax exemption for all computing and equipment software used by companies certified as data centers by the agency. The City of Southaven and DeSoto County are also supporting xAI’s projects through fee-in-lieu agreements.

“Starting off 2026 with a $20 billion investment by xAI is a clear sign Mississippi is not letting up on the economic momentum we have built over the last few years. Our focus on speed, certainty and readiness allows companies to move quickly and with confidence, while also enabling Mississippi to compete for capital-intensive, advanced technology projects like xAI. These investments bring new, high-quality jobs to the people of Mississippi and place our state at the center of the ‘Digital Delta.’ We are proud to partner with the xAI team as we continue building the future of tech innovation right here in Mississippi,” Mississippi Development Authority Executive Director Bill Cork noted.

xA’s flagship product is Grok, a generative AI chatbot integrated with the social media platform X. The company also offers application programming interface tools such as image generation, voice and agent tools, along with the xAI For Government suite of products for American federal, state and local government uses.

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