A total of 24 new homes will be built on the site of the former St Peter's Primary School at Highstonehall Road.
The project has been designed in-house by the council and is supported by Scottish Government funding.
Speaking at the sod-cutting event to mark the start of construction, Cllr Josh Wilson said: "This latest phase of our Home+ programme brings much needed additional high quality homes to the area.
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"This project together with our recently approved developments in Blantyre and our flats conversion underway on Almada Street puts us on course to deliver 68 new council homes in the Hamilton and Blantyre area by Autumn 2018, contributing to our target of 1000 new council homes across South Lanarkshire by 2021."
Daniel Lowe, Executive Director of Housing, added: "These new homes have been designed with generous space standards, high quality kitchens and bathrooms and incorporate renewable technologies such as solar panels to deliver cheaper to run, energy efficient homes benefiting both the environment and household budgets."
Partnering and Procurement Director at Cruden, Gordon Lee, said throughout the project the contractor will work with local suppliers to directly benefit the community.
"We will also provide work placement and training opportunities to give young people first-hand experience of the varied roles available within the construction industry," he said.
(LM/CD)
