A telework centre due to open on Arainn Mhor in March will be the first of its kind on any offshore island in Ireland.
A private company, supported by five State agencies, is to run the business which it describes as a "template for development" in other rural areas.
It will provide the first employment on the island, other than from fishing or tourism, since the closure of a textiles factory more than 20 years ago.
Mr Tony Gallagher, manager of the island's development co-operative, Comharchumann Oilean Arainn Mhor Teo, said it was a very significant development in providing meaningful jobs and stopping "the brain drain".
He said one reason the textiles factory closed was because of the high cost of getting raw materials onto the island. "Technology is the only way we can go. It is the only type of enterprise that is viable."
Tele Arainn Teo will initially employ five people but manager Mr Chris McDonagh said he expects to reach a target of 20 jobs within 18 months.
A Sligo-based businessman, Mr McDonagh is a partner in CMD, a training institute which also provides business advice. He first became involved with the islanders when asked by FÁS to provide telework training on Arainn Mhor.
He said no major company was going to set up a call-centre on the island, but a telework centre, operating on a small scale, could be viable. Much planning and research had been carried out over two years. "We have now secured enough work for five people for 12 months doing telemarketing and promotion work for a large US company, and we are also in discussions with other companies."
Mr McDonagh acknowledged that funding from State agencies was a factor in choosing the island.
"We know it is possible on the island because we have put a lot of energy and resources into this. In 18 months we will have 20 people employed and that will be three per cent of the island's population. So it may seem small but it would be equivalent to hundreds of jobs in Dublin."
He said it was the first time five State agencies, a local community and the private sector had come together to create jobs and he believed it was a template other rural communities could follow.
"People have to realise that it has to start small and it will stay small. Staying small means we will be able to weather any storm."
Mr Gallagher said the co-op first approached FÁS to provide computer training over four years ago. Since then some islanders had found work on the mainland but many were available for work. He had been to Scotland to see similar projects on islands there.
Tele Arainn Teo will open on March 11th in a newly built enterprise centre. High-speed phone lines and an improved electricity supply has been provided. Funding for the building and for training came from Údarás na Gaeltachta, Rinn na Gaeltachta, the Gaeltacht Leader company MFG Teo, the Department of Social, Community and Family Affairs and FÁS.