The UKIP leader told MEPs that the vote would be an opportunity for the UK to regain its "national self-confidence".
He described David Cameron's renegotiation strategy as a "charade" which would yield only "minor" changes.
EU leaders will discuss the UK's reform agenda, including proposed curbs on benefits, at a dinner on Thursday.
While there will be no agreement at the two-day EU Council meeting, the UK expects there to be "substantive and frank discussions" which could potentially pave the way for a deal in February.
The talks are likely to show the level of support and opposition to Mr Cameron's four main reform objectives, the most contentious of which is a four-year ban on EU migrants claiming in work-benefits. The UK also wants more powers for national Parliaments, legally-binding safeguards for countries outside the eurozone and an opt-out for the UK from the principle of ever-closer union.
Although David Cameron has said he will not name the referendum date until the negotiations have concluded, Mr Farage - who has long campaigned for the UK to leave the EU - said he expected it to be held next June.
Speaking in the European Parliament, he said he expected David Cameron to be given short shrift at Thursday's dinner, claiming the UK prime minister had only been allowed to speak for seven minutes at an earlier dinner in June when he first set out his plans after the Conservatives' election victory.
"He (David Cameron) has asked for almost nothing and is unlikely to get even that," he said.
"But I am sure we will be treated to the usual theatricals. A grave-faced prime minister will come back to the UK to say how tough the negotiations have been, to say he will not give in and there will be hints that the PM will even support "Brexit" if he does not get his own way.
"In February, the charade will come back. There will be a European summit and on something minor and inconsequential there will be a deal."
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Mr Farage said the backlash against migrant quotas in Hungary and other countries and the performance of the Front National in recent regional elections in France showed the degree to which opposition to the European Union was "growing right across the continent".
He added: "So far nobody has reached the tipping point but the British referendum may be that moment. The momentum is on our side. It is not just about getting back national democracy, it is about getting back national self-confidence.
"For those of us who believe in nation state democracy, 2016 is a very bright dawn indeed."
Speaking in the same debate in Strasbourg, Gianni Pitella - the head of the Socialist and Democrat Group in the Parliament - said the EU must do "everything it can" to keep the UK as a member and the UK needed a "clear and positive commitment to conclude the negotiations".
And Guy Verhofstadt, the former Belgian prime minister who is now an MEP, said there must be a "constructive" response to the UK's demands - which he said provided the EU with an opportunity to pursue other "desperately needed" changes, including new governance arrangements for the eurozone and a "defence community".
Speaking on Wednesday, former British prime minister Sir John Major warned against the UK "flirting" with EU exit, saying it would be dangerous to adopt a position of "splendid isolation" when the world was "coming together" to fight common challenges.
The referendum on the UK's future in the European Union could be a "tipping point" for opposition to the "European project", Nigel Farage has said.