Elon Musk’s AI startup, xAI, is set to invest over $20 billion in expanding a data center in Mississippi, USA. Governor Tate Reeves highlighted that this will be the largest private investment in the state’s history.
Join me as we announce a record-breaking $20 billion investment in our state.
Mississippi has momentum and THIS is our time! https://t.co/wf86VZ8snW
— Governor Tate Reeves (@tatereeves) January 8, 2026
Last year, demand for data center capacity surged amid a boom in the artificial intelligence sector. Consequently, power systems in developed countries began to experience issues due to the increased load.
On December 30, Musk announced the purchase of a data center, which he named MACROHARDRR. This is presumably a tongue-in-cheek reference to Microsoft, as the word is an antonym to the corporation’s brand with an added RR at the end.
The billionaire did not disclose details at the time, only noting that the facility would allow xAI to expand its available capacity to 2 GW.
According to Governor Reeves, the data center is located in Southaven, near a power plant recently acquired by the startup. Operations are expected to commence as early as February this year.
In September 2024, xAI launched the Colossus AI training cluster in Memphis, Tennessee, utilizing 100,000 Nvidia H100 graphics processors. It was considered the largest in the world at that time. Environmentalists accused the data center of exacerbating environmental conditions due to the use of gas turbines.
In January 2025, U.S. President Donald Trump announced $500 billion in private investments for AI infrastructure. The initial investment by the joint venture OpenAI, Softbank, and Oracle, named Stargate, was planned at $100 billion, with further expansion anticipated. Experts doubted the initiative’s ability to attract the stated capital amount.
The first Stargate data center complex, with a capacity of 1.2 GW, is expected to be completed by mid-2026. The facility will house up to 400,000 powerful AI chips from Nvidia.