The project, which Dong acquired from RES Americas in April 2015, is planned for a site 88km from mainland US.
Dong will handle the offshore work, while Eversource will be responsible for the onshore transmission infrastructure.
Dong said the project is planned for completion in the early 2020s.
"We are encouraged by the dramatic progress that Europe is making in the offshore wind market. Wind technology is rapidly advancing, output is increasing and prices are dramatically dropping," said Eversource executive vice president of strategy and business development Lee Olivier.
In August, the Massachusetts state government passed a bill requiring local utilities to buy 1.6GW of offshore wind power by July 2027 and a further 1.2GW from alternative renewable energy sources.
Bay State Wind is one of two sites Dong is developing in the US. It also owns the 1GW Ocean Wind site off the coast of New Jersey.
Eversource has a small portfolio of renewable energy it owns and operates in northeast US. This includes a 50MW biomass facility in New Hampshire, 8MW of solar projects and 70MW of hydroelectric plants.
