Previously, art students were housed in two "unsatisfactory" sites in other parts of the city.
The new annex adjoins P Block, which was constructed in 1997, and the rest of the school occupies the former Dunedin North Intermediate School buildings on the same Albany St site.
School head Bridie Lonie said the facility had flexible studio spaces upstairs, a large lecture theatre and a spacious art gallery downstairs. It would also be the school's front door, with a new main entrance leading out on to Riego St.
The gallery was a first for the polytechnic, and a welcome addition for students who needed to learn how a commercial gallery worked.
It would be open to the public and would show the works of students and outside artists.
The annex was officially opened last week by National list MP Michael Woodhouse and the new gallery was filled with students' electronic art for the celebration.
Ms Lonie said the building (designed by McCoy and Wixon architect Regan Hall) was "a really clever and exciting space to be in" and she was looking forward to having around 225 art students together again.
"It feels great to have a place to call home. The students are all on site and they are now a community."
The art school annex is one of two major projects part-funded by a capital works grant from the Tertiary Education Commission.
The other is a $4 million revamp and extension of the student centre in Harbour Tce to enable the catering and hospitality school to be relocated from its present site in Tennyson St, near Otago Girls High School. The target completion date for that project is June.
