Hotels, offices, luxury apartments and a shopping centre will all feature in the giant structure, which is to be financed by the Saudi royal family-owned Kingdom Holding Company.
American company Adrian Smith + Gordon Gill Architecture has been employed to design and oversee development of the project. The same group was responsible for the construction of the Burj.
However, the scale of the project has attracted criticism from some experts.
Rory Olcayto, deputy editor of The Architects' Journal, commented: 'The race to build the highest skyscraper is quite futile - where do you stop?
'These buildings are missing the point and are a symbol of an old-fashioned way of thinking.
'It's much better to look at something like the 3D China Central Television Headquarters in Beijing rather than a thrusting phallic tower.'
The title of world's tallest building was held by American structures for nearly all of the 20th century, with the Empire State Building, the Sears Tower and the World Trade Center all holding the honour until the Petronas Twin Towers opened in Kuala Lumpur, Malaysia, in 1998.