The centre would have 80 to 100 beds and create up to 250 local jobs.
Currently, young offenders from Wales have to be placed in accommodation somewhere in England. There are centres in County Durham, Warwickshire and Kent.
The proposed centre, in Glyneath, is waiting on the go-ahead from Neath Port Talbot County Borough Council.
If it gets the green light, the YJB hopes to have the centre opened in 2005.
Mark Perfect, YJB chief executive, said: "The board has an aim to place young people sentenced to custody within 50 miles of their home to help maintain links with their youth offending team and their family.
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