You have any number of options for this. dnsmasq, etc.
A split DNS system (running your own BIND or whatnot) is quite easy to do, and only requires that you keep your DNS server (or servers) on something resembling high-availability hardware. Obviously, if you set your internal DNS as primary on all your internal hosts and it goes down, your internal stuff will have a bit of a problem.
So yeah, basic BIND installation, with forwarders set up to whatever your favorite DNS servers are, and implementing your own TLDs is pretty common and you shouldn't have any great difficulty.
Just be sure that your TLD isn't already taken.