The massive redesign will begin next year and encompasses 18 new buildings, $150 million in transportation infrastructure improvements, and almost 7 million square feet of renovations to existing workspace, Microsoft said.
The project is slated to take around five to seven years to complete and, according to Bloomberg, will cost multiple billions.
The changes will replace the original X-shaped buildings where co-founder and former CEO Bill Gates moved the company in 1986, shortly before Microsoft went public.
In total, the new campus will house the 47,000 employees who work at Microsoft's existing Redmond campus, and add capacity for 8,000 more.
As part of the project, Microsoft will also tear down older buildings that no longer fit its needs. Cars will be stored in an underground parking facility.
Several of the new Microsoft buildings will be four stories tall and centered on a new 2-acre plaza where events can be held - giving the campus a bit of an urban vibe, Smith said.
That transportation emphasis is perhaps the biggest difference from the expansion plan a decade ago.
Microsoft's renovation budget is modest compared with the $5bn Apple spent on its new spaceship headquarters in Cupertino, while Microsoft's Washington neighbor and cloud rival, Amazon, will spend $5bn on a second North American headquarters, which will offer space for 50,000 people. We prize our relationship with the City of Redmond and will work closely with officials on the approval for campus and building architectural designs, engineering, building permit review and land use code compliance.
It is clear that Nadella is looking to revive the work culture at Microsoft, making it a little more collaborative with employees coming out of the closed-door offices and working in a more interactive environment. Having been the bane of many Microsoft employee for their confusing corridors, it's unlikely they'll be missed.
"This is going to be an extremely intelligent campus, not because of devices but because of infrastructure", says Bill Lee, Microsoft's director of real estate, planning, and development, in the company's post.