A consortium comprising MDBA, QinetiQ, BAE Systems amongst others will use the money to assess how a laser directed weapon can precisely detect and track targets at various ranges and in challenging weather conditions over land and water.
If the project is successful, the first laser weapons could come into service around 2025.
Minister for defence procurement Harriet Baldwin said: “The UK has long enjoyed a reputation as a world leader in innovation and it is truly ground-breaking projects like the laser directed energy weapon which will keep this country ahead of the curve.
“The defence innovation initiative and £800 million defence innovation fund aim to encourage imagination, ingenuity and entrepreneurship, in pursuit of maintaining a military advantage in the future.”
A statement from the MOD’s Defence Science and Technology Laboratory (Dstl) added that the project will draw on innovative research into high power lasers to help it understand the technology’s potential to provide a more effective response to emerging threats that could be faced by UK armed forces.