Claiming that he had 20,000 advance bookings for the maiden voyage, Palmer said he plans to build the 21st Century version of the luxury liner exactly of the same dimension as its ill-fated predecessor, which sank 100 years ago, Sydney Morning Herald reported.
Palmer plans to build the 840 rooms and nine decks ship in a Chinese shipyard and has hired a Finland-based company Deltamarin to review the vessel's compliance with safety and construction regulations.
The Australian tycoon proposes to run the ship as a regular feature on the transatlantic route between the UK and US.
"This magnificent vessel is being constructed in memory of the heroic people who served on the first ship, as well as the passengers who sadly shared their fate," Palmer said in a statement.
The design criteria would be to keep the ship as identical to the original Titanic as possible, with changes only below the water line for diesel generation and greater fuel efficiency.
The ship is expected to be ready by 2016, the newspaper reported.
Palmer has invited the Chinese navy to escort Titanic II on its maiden journey from China to the United Kingdom where the ship will then re-trace the intended route of the original ship.
The original Titanic sank in 1912, killing more than 1500 passengers and crew.
