McGrigor Donald Public Policy (MDPP) will be headed up by McGrigor lawyer, Adam Bruce. He will be aided by the 56-partner firm's head of commercial litigation, Niall Scott and its public sector unit director, Alan Boyd.
The new unit will give advice on new Scottish legislation, provide a Parliamentary monitoring service and even push forward private legislation.
The firm is currently on the look out for an extra director and a research officer to join the group, both of whom are likely to be from a non-legal background.
MDPP has emerged out of the firm's Scottish Parliament Group which was set up in 1997 to provide advice on the impact of the Government's plans for devolution in Scotland.
McGrigor's UK managing partner, Kirk Murdoch says: "If you look across Europe, and in the English speaking world beyond London, it is clear that law firms are at the forefront of the provision if public affairs advice.
"As a result, McGrigor Donald has set up MDPP to continue to provide public affairs and public policy advice within the professional framework of a UK law firm."