diff --git a/src/openstack_mcp_server/tools/identity_tools.py b/src/openstack_mcp_server/tools/identity_tools.py
index 1010cf6..b639f8a 100644
--- a/src/openstack_mcp_server/tools/identity_tools.py
+++ b/src/openstack_mcp_server/tools/identity_tools.py
@@ -28,6 +28,7 @@ def register_tools(self, mcp: FastMCP):
 
         mcp.tool()(self.get_projects)
         mcp.tool()(self.get_project)
+        mcp.tool()(self.create_project)
 
     def get_regions(self) -> list[Region]:
         """
@@ -269,3 +270,41 @@ def get_project(self, name: str) -> Project:
             domain_id=project.domain_id,
             parent_id=project.parent_id,
         )
+
+    def create_project(
+        self,
+        name: str,
+        description: str | None = None,
+        is_enabled: bool = True,
+        domain_id: str | None = None,
+        parent_id: str | None = None,
+    ) -> Project:
+        """
+        Create a new project.
+
+        :param name: The name of the project.
+        :param description: The description of the project.
+        :param is_enabled: Whether the project is enabled.
+        :param domain_id: The ID of the domain.
+        :param parent_id: The ID of the parent project.
+
+        :return: The created Project object.
+        """
+        conn = get_openstack_conn()
+
+        project = conn.identity.create_project(
+            name=name,
+            description=description,
+            is_enabled=is_enabled,
+            domain_id=domain_id,
+            parent_id=parent_id,
+        )
+
+        return Project(
+            id=project.id,
+            name=project.name,
+            description=project.description,
+            is_enabled=project.is_enabled,
+            domain_id=project.domain_id,
+            parent_id=project.parent_id,
+        )
diff --git a/tests/tools/test_identity_tools.py b/tests/tools/test_identity_tools.py
index 7245c90..ccb99e7 100644
--- a/tests/tools/test_identity_tools.py
+++ b/tests/tools/test_identity_tools.py
@@ -853,3 +853,86 @@ def test_get_project_not_found(self, mock_get_openstack_conn_identity):
             name_or_id="ProjectOne",
             ignore_missing=False,
         )
+
+    def test_create_project_success_with_all_fields(
+        self, mock_get_openstack_conn_identity
+    ):
+        """Test creating a identity project successfully."""
+        mock_conn = mock_get_openstack_conn_identity
+
+        # Create mock project object
+        mock_project = Mock()
+        mock_project.id = "project1111111111111111111111111"
+        mock_project.name = "ProjectOne"
+        mock_project.description = "Project One description"
+        mock_project.is_enabled = True
+        mock_project.domain_id = "domain1111111111111111111111111"
+        mock_project.parent_id = "parentproject1111111111111111111"
+
+        # Configure mock project.create_project()
+        mock_conn.identity.create_project.return_value = mock_project
+
+        # Test create_project()
+        identity_tools = self.get_identity_tools()
+        result = identity_tools.create_project(
+            name="ProjectOne",
+            description="Project One description",
+            is_enabled=True,
+            domain_id="domain1111111111111111111111111",
+            parent_id="parentproject1111111111111111111",
+        )
+
+        # Verify results
+        assert result == Project(
+            id="project1111111111111111111111111",
+            name="ProjectOne",
+            description="Project One description",
+            is_enabled=True,
+            domain_id="domain1111111111111111111111111",
+            parent_id="parentproject1111111111111111111",
+        )
+
+        # Verify mock calls
+        mock_conn.identity.create_project.assert_called_once_with(
+            name="ProjectOne",
+            description="Project One description",
+            is_enabled=True,
+            domain_id="domain1111111111111111111111111",
+            parent_id="parentproject1111111111111111111",
+        )
+
+    def test_create_project_without_all_fields(
+        self, mock_get_openstack_conn_identity
+    ):
+        """Test creating a identity project without all fields."""
+        mock_conn = mock_get_openstack_conn_identity
+
+        mock_conn.identity.create_project.side_effect = (
+            exceptions.BadRequestException(
+                "Field required",
+            )
+        )
+
+        # Test create_project()
+        identity_tools = self.get_identity_tools()
+
+        with pytest.raises(
+            exceptions.BadRequestException,
+            match="Field required",
+        ):
+            identity_tools.create_project(
+                name="ProjectOne",
+                description="Project One description",
+                is_enabled=True,
+                domain_id=None,
+                parent_id=None,
+            )
+
+        # Verify mock calls
+        mock_conn.identity.create_project.assert_called_once_with(
+            name="ProjectOne",
+            description="Project One description",
+            is_enabled=True,
+            domain_id=None,
+            parent_id=None,
+        )