Chief Executive Stuart Gallacher made the announcement on Monday, admitting he faced a no-win situation off the field but that the decision was based purely on the increased chances of progressing.
"Weve made an early decision on the venue to end speculation from both media and spectators that we were moving the game away from Stradey Park," he said in a statement on Monday.
"Our players and supporters deserve the best possible opportunity of progressing further in the knockout stages and we believe playing at Stradey Park gives us that chance."
In the immediate aftermath of the tight 20-16 win over Londond Irish on Sunday, Gallacher confessed to being in two minds over the decision.
A sell-out crowd at the LIberty would have been a huge boost to the region's emptying coffers, but there was not only the 'Stradey factor' to think of for the players, there was also the nostalgia in the fact that if the ground developments in Llanelli go ahead, this will be Stradey park's last Heineken Cup season.
"It is a no-win decision. Damned if we do, damned if we don't," Gallacher had said to reporters.
"As far as the rugby is concerned obviously we have to play at Stradey Park, none of us would disagree that that is the right rugby decision.
"But, unfortunately, in this modern game and particularly where we are at the moment, I have to look at the financial position as well.
"Munster is a huge game support-wise for both teams and with only 10,800 at Stradey we could do with a bigger capacity.
"There is no question we could fill the Liberty Stadium for this game against Munster.
"If it is an emotional decision, you don't move from Stradey, if you look at it in the cold light of day, which sometimes I have to do, you have to look at the alternative, which is double the revenue."
However, a £250,000 ($494,000) windfall for making the quarter-finals will go some way to compensating for that.
Captain Simon Easterby indicated that the decision would go down well with the players.
"The players would prefer to play at Stradey, to be honest," he said after the game.
"It is not as big capacity-wise as the Liberty Stadium, but it is our home ground.
"When you work hard through the group to get a home quarter-final tie you want to play it at home."