The Kosciuszko will run at Randwick Racecourse on Everest Day, 13 October 2018.
The new race will feature only NSW country-trained racehorses.
Minister for Racing Paul Toole said the additional prize money will further support regional NSW racing and help boost participation across the entire industry.
“This is a great opportunity for clubs to come up with creative ideas to build new markets or help people gain a start in the industry through education and training,” Mr Toole said.
Under the government’s new Back to the Track Regional Racing Grants program, regional racing clubs across thoroughbred, harness and greyhound racing can apply for a share in $400,000 for projects that will build stronger links with their communities.