The social media giant is reportedly looking to build a facility with three server halls in an industrial area near Odense, which is Denmark's third largest city.
Up to 1,200 jobs could be created during the construction of the data centre, fyens.dk wrote in a follow up article on Monday. Construction efforts will reportedly be led by British firm Mace.
The 500,000 square meter (5.4 million square feet) construction site was reportedly acquired by Cassin Networks Aps, said to be owned by Facebook, for 68 million DKK (£7.9 million; $10 million), with the money going to the municipality of Odense.
A fence was reportedly put up around the site at the end of last week and the area is now being monitored by security.
The report from fyens.dk states that the data centre in Denmark will be even larger than Facebook's $450 million (£347 million) data centre in Lulea, Sweden, which opened in 2013. Facebook is also in the process of building another $220 million (£170 million) data centre in Ireland.
A computer generated image of Facebook's Fort Worth data centre in the US.
Data centres are vital to Facebook, which is dealing with an increasing amount of information on its platform. These huge server farms are used to compute and process the actions taken by Facebook's billions of users around the world every day.
The news will likely come as a blow to other European countries like Iceland which have been trying tempt Silicon Valley giants to build their data centres on their shores in a bid to create jobs and attract investment.
Facebook did not immediately respond to Business Insider's request for comment.