Planning bosses at Sandwell Council have approved a scheme for the new one-storey building at the Shri Venkateswara Balaji temple on Dudley Road East.
There is no timescale as to when the building will be constructed as the plans are still being negotiated, but the council has given its blessing for the scheme to go ahead.
Leaders at the temple will now be able to build a Yagashala building, which caters for a special ceremony to introduce babies to the faith, which is much like a baptism.
Temple manager Leo O'Toole said: "We are trying now to get an agreement with our architects and designers over the final profile of the building.
"It's such as unique building that we want to make sure we get it right. That's complex, and we need to make sure we get it right to start with.
"We won't have a timescale for the project until we agree the construction profile, but we are trying to push it forward as fast as we can."
The Yagashala ceremony is currently carried out within the existing buildings, but the temple leaders always planned to construct a specific building to cater for the religious ritual.
A report to council planners states: "The design of the Yagashala building has been developed to be in keeping with the surrounding shrine buildings, which have been constructed on the 21.5 acre site.
"The Yagashala building will, therefore, be a simple, low-profile building to be sited to the north of the site and positioned at the foot of a natural embankment."
Planning documents state the single-storey building would have a rendered exterior which will match the other buildings and will have a simple, low-profile concrete roof.
The new building is not expected to generate additional visitors, as its function is already undertaken in the main building. Part of the Yagashala ceremony involves the child's first hair cut.
This is considered to be particularly auspicious when it is performed on the temple's premises as it signifies the release from the past life.
After the haircut and a bath, the child is dressed in new clothes and prayers are said at the temple for the child's wellbeing.
Some of the ritual also involves offerings, such as cheese and grains, being given to deities by being put into a fire.
This is not the first extension to the site. In 2011 the temple bosses applied for and built a single-storey extension to the existing shrine buildings to increase space for the north and south shrines at the site.
For the past ten years the temple has grown to become physically the largest South Indian temple precinct in Europe.