The move takes Intel’s total investments in Vietnam to around $1.5 billion, it said.
The money will help it "take on more complex technologies" and diversify beyond the central processing units at the heart of its business, Intel said.
General manager Kim Huat Ooi said: “Intel products from Vietnam are an important part in Intel’s supply chain.”
Vietnam has become an increasingly crucial part of the global technology supply chain, with companies such as Apple and Samsung seeking to diversify their production to minimise the impact of a Sino-US trade war and after the Southeast Asian country has been able to contain the spread of the coronavirus so far.
Intel is under pressure to do more to sort out its chip shortage and the fact it has fallen behind outer foundries. It has already outsourced some chip production to its rivals.