The move follows the publication of the National Space Strategy in September 2021.
As part of the strategy, the UK Government will invest around £1.4bn ($1.9bn) in satellites and other technologies over the next ten years.
Around £968m will be used to deliver a multi-satellite system that will enable greater global surveillance and intelligence for military operations called the ISTARI Programme.
The programme also allocated £61m to fund the development of laser communications technology that will enable transmission of data from space to Earth at a speed equivalent to superfast broadband.
UK Defence Secretary Ben Wallace said: “It’s crucial we continue to push the frontiers of our defence space ambitions, enhancing our military resilience and strengthening our nation’s security.
“This significant investment will help to ensure the UK remains at the forefront of space innovation and one step ahead of our competitors.”
The overall investment is on top of the existing £5bn allocated for upgrading the UK’s Skynet satellite communications capability. These satellites are used for strategic communication by the UK Armed Forces and allies.
The MoD also announced that some supporting programmes that are funded through existing investment will be rolled out as part of the DSS.
These programmes include Minerva and Prometheus-2.
In Minerva, the UK will develop a network of satellites to collect, process and disseminate data from the UK and allied space assets to facilitate the frontline military decision-making process. Work under the programme is currently underway.
It will deliver a developed and tested system that will be brought together under the established UK Space Command while underpinning the ISTARI Programme.
The Prometheus-2 initiative involves two small satellites and will be used to support the MoD’s science and technology activities.
Last December, the UK partnered with Japan on a joint development programme to design and build a future fighter jet engine demonstrator.