The secretive shipyards of Bremen in northern Germany are the places where Russian oligarchs and Silicon Valley billionaires go to have their fantasies (and insecurities) made into yachts. In a hangar at the yard of Fassmer on the banks of the River Weser, however, a different kind of £16m dream boat is taking shape.

It is a dream that began more than 25 years ago, when Greenpeace's Rainbow Warrior was sunk in Auckland Harbour by bombs planted by the French secret service. The determination then, from environmental activists across the globe, was that "you can't sink a Rainbow". In the years since, Greenpeace has become perhaps the world's most recognisable and sophisticated global eco-charity. Its ships, however – converted trawlers and gas guzzlers – have never quite lived up to its green aspirations. That is where the dream comes in.

The new Rainbow Warrior III, which I had come to Bremen to get a first look at, will be among the most environmentally advanced ships of its size at sea. The boat – "don't call it a yacht!" I'm told – is nearly 60m long and currently cased in scaffolding, though the distinctive dove of peace and childlike red-and-yellow- and-pink-and-green rainbow is visible on its hull. At the beginning of next month, when the ship is baptised, twin 50-metre masts will be hoisted on its deck to carry 1,200 sq m of sail. A state-of-the-art hybrid engine will be needed for only about 10% of its operational power.

Everything about it, from the paintwork to the insulation, has been designed with sustainability in mind. Each component comes with transparent ethical sourcing. Below deck the ship will house one of the most sophisticated communications operations anywhere on the ocean. As well as all this up-to-the-minute kit, the boat is required to have something that is not mentioned in the hundreds of pages of specification: a soul.

This particular tricky fixture is very much rooted in its history. On one level Rainbow Warrior III is the inspired result of some of the latest thinking in sailboat technology from world-leading – mainly Dutch – computer modellers and wind-tunnel obsessives. On another it is the latest fulfilment of an old Native American prophecy: "There will come a time when the earth grows sick, and when it does a tribe will gather from all the cultures of the world who believe in deeds and not words. They will work to heal it... they will be known as the 'Warriors of the Rainbow'."

There are various sources for that prophecy, which spread among early environmentalists when it was published in a book of Hopi Indian and Cree legends in California in 1962. But 15 years later, when Greenpeace activists in the UK came up with the idea of taking a ship to bear witness to some of the more blatant acts of ecological destruction – from whaling and oil exploration to nuclear testing and industrial fishing – that were occurring in the remote oceans, there was only one name that could do it justice. The Aberdeen-built trawler the Sir William Hardy" was almost ready for scrap when it was bought by Greenpeace for £40,000. After a refit and hand-painting of the famous logo on its bow, it first sailed out along the Thames on 15 May 1978.

The first Rainbow Warrior had been making headlines (and trouble for corporations and governments) successfully for seven years when, on a mission to disrupt French nuclear testing in the South Pacific, it was infamously sunk in Auckland harbour by two bombs attached to its hull by French secret agents. One Greenpeace crew member, the photographer Fernando Pereira, was killed, having gone below deck after the first explosion to try to retrieve his cameras. The story quickly became a defining legend, not just of Greenpeace but of environmental activism in general.

This history seemed very present as I walked around the half-finished decks of the new boat, where German engineers were efficiently welding together the latest incarnation of the mythology. The Rainbow Warrior III project is being overseen in Bremen by William Sykes, a 6ft 6in Glaswegian second-row forward, who points out to me some of the ship's more unusual features – the advanced technology that will drop smaller inflatable speedboats from its sides at record speed for the quickest possible advance or getaway; the helicopter pad that can be created on deck; the below-deck radio room with its reinforced door built to allow at least 30 minutes transmission time in the event of the ship being boarded – as it has been in the past – by SAS-style commandos wielding axes.

When it first embarked on the commissioning of the ship, Greenpeace canvassed staff at its 40 global offices to come up with a list of "wants and needs" for the project. As Ulrich von Eitzen, Greenpeace's operations director, explains, "You can imagine that the wish list we got was quite a long one." From it was developed a functional specification of 12 closely typed pages. One of the more insistent requirements, particularly from long-term crew members with the scent of old voyages to the Arctic or up the Amazon still vivid, was for a shower in each double cabin, as opposed to the scant communal facilities that had characterised previous boats. Keen attention was also paid to both the galley facilities and the sewage arrangements. As Sykes observes with a degree of pride, it is down to him to "get 10lb of shit into a 2lb bag".

His current focus in that mission is on 10 July when, having left its dry dock and been floated for the first time, the huge A-frame masts will be slotted into the ship's deck. The date has a powerful significance: it's the 26th anniversary of the bombing of the first Rainbow Warrior. Those who were on board that night have been following the progress of the new ship with a sense of expectation.

When I phoned Peter Willcox, the captain in 1985, he was on board a yacht near his home in Chesapeake Bay, Maryland. He has worked as a skipper for Greenpeace for 30 years, at sea for six months of most of them. He has been distantly involved with the plans for the new Warrior, but mostly, he says wryly, "they seemed happy to keep me about 4,000 miles away". Once the Rainbow Warrior III has done a European tour of duty at the end of the year, and given supporters a chance to see what their £10 a month has helped to pay for, Willcox will join it in the Azores in January and take the helm to America. He will then sail it up the Amazon, on its maiden campaign, as part of the protest against deforestation.

He still relives the day 26 years ago when he had to give the fateful shout to abandon ship. "One particularly moving thing for me," he says "was the 20th anniversary of the bombing, when I got to meet Marelle Pereira – Fernando's daughter. She is a remarkable woman who has gone through hell as a result of losing her father." That anniversary was marked by the arrival of Rainbow Warrior II at Auckland and a special Maori ceremony. The second Rainbow Warrior, a recycled ship that went into service four years after the sinking, these days spends more time out of the water than in it and, at 52 years old, is about to be retired.

Willcox, at 58, has no such plans. Things have changed over the years at Greenpeace, but one thing has not altered: "The atmosphere on the boats isn't very different . There is still a group of people bound by a similar goal." The job allows him to see the wonders of the planet as well as the way we abuse them. "The most memorable trip was a couple of years ago, going up to Greenland to do climate-change research," he says. "We were up north of 80 degrees for seven weeks, kayaking in ice melt." After that he was monitoring the BP oil spill in the Gulf of Mexico – "just depressing".

Willcox is an optimist, but over the 30 years he has never felt as though they were winning. "Greenpeace may be taken more seriously than it was 40 years ago, but that's partly because the planet is on its knees."

Still, he can't wait to get out on Rainbow Warrior III, not least because "Greenpeace running around in big polluting motor vessels is not ideal. It is good to see us get serious about alternative technology, because if we don't, how can we expect anyone else to?"

For David Edward, a Yorkshireman who was engineer on the boat in 1985, there is a great feeling of continuity. Edward is now in charge of all Greenpeace vessels at sea, but he is closely watching progress in Bremen. For him, the bombing was the point at which Greenpeace grew up as an organisation. "I think it was a springboard for Greenpeace International. It made us even more determined," he says. "But also lawyers are now a big part of Greenpeace." For a long while after the first Rainbow Warrior was raised, Edward thought it should be repaired. Eventually, though, it became clear that the ship was going to be scuttled so he felt he should get back to his family in Yorkshire. Getting out for sea trials on the new boat in the coming months will feel like another sort of homecoming. "For me, it's the closing of a circle," he says. "When we were in New Zealand with the old Warrior, after the bombing, I would go round schools and kids would hand me pocket money to help us build a new ship. I like to think that that money has finally helped to pay for this new boat."

Of course Rainbow Warrior III has to be as much about the future as about the past. Everyone I speak to at Greenpeace talks about getting the balance right between the size of the organisation and the need to put all the energy not into bureaucracy but the sharp end of campaigning. Rainbow Warrior III encapsulates this balance. Greenpeace is not a homemade anarchic kind of concern any more, it is a sophisticated lobbying network, but it still wants to be at the cutting end of environmental defence. "One thing this boat says very clearly," Ulrich von Eizen maintains, "is that we are still out there. At this very moment we have crews out on an oil rig trying to stop Arctic offshore drilling. We haven't changed our attitude, and we will not be silenced."

Though Rainbow Warrior has a proud history, he suggests, the boat in Bremen is not an exercise in nostalgia. "Rainbow Warrior is a strong name. But 20-year-olds don't necessarily know anything about it. This is not about preserving our past victories, it's about the future. To keep on bearing witness."

The Sinking of the Rainbow Warrior, 10 June 1985

By Steve Sawyer, former campaign leader on the ship

The day of the bombing was my birthday. I was 29. And I guess it is the day I really grew up. All the talk about standing up for what you believe in became different after Fernando Pereira was killed on the Rainbow Warrior. I was interviewed immediately afterwards and asked if I thought the French had done it and I said I really didn't believe they would do something so stupid. That aired Sunday night. And then on Monday morning they arrested the French spies who had planted the bombs, masquerading as a Swiss honeymooning couple. So you learn. After that I spent five or six years dealing with the court case, then became American director of Greenpeace and then international director. But that night stays with me.

Having celebrated my birthday, I had gone off about 20 minutes before midnight to stay in a hotel across town, where I was meant to have a meeting the next day. We had just broken open a bottle of rum that I'd had for my birthday and were playing a game of pool, and the woman from the hotel said there was a phone call for me. It was a woman from Greenpeace New Zealand, who said there had been a fire and an explosion on the boat. So we piled into a car and drove back across town. The dock was cordoned off and the crew were across the street at the police station. I saw Chris Robinson, one of our skippers, who told me, "They blew up the boat and killed Fernando." It took us some time to convince the police of those facts. They thought they were looking at a bunch of hippies with a big green boat. Their first reaction was, "How are you going to get your ship off the bottom of our harbour?" It was only when the divers went down the next day and found that the explosion had blown in and not out that the attitude of the police changed. The thing I remember most, though, was that we set up an office to try to deal with stuff and that afternoon people started arriving. Someone brought bags of clothes for us. Other stuff started coming. Someone set up a little kitchen in the office to feed the crew. Then people came with buckets of cash for us that they had collected on the street. They were giving, they said, for us to build a new boat. To keep on going.

If you would like to make a donation towards Rainbow Warrior III go to greenpeace.org.uk/rainbow-warrior

• This article was amended on 15 June 2011 to correct the picture's location to Bremen.