The Ministry of Defence (MoD) is to auction some of its valuable radio spectrum.
Around 200 megahertz of the spectrum currently used by the MoD will be included in the sale to take place in 2014.
Announcing the plan to MPs, Defence Minister Philip Dunne said allowing private operators to access the spectrum could increase the availability of communications services "vital to the UK's prosperity".
Preparations for the sale are expected to start at the end of 2013 with the auction completed by the summer of 2014.
Mr Dunne said: "The sale will give private operators the opportunity to acquire more capacity to support, for example, the introduction of fourth-generation mobile services to people in cities, towns and villages across the United Kingdom, or to expand wireless access to broadband services, both of which are vital to the UK's prosperity."
The move by the MoD will contribute towards the government's target that at least 500MHz of public sector spectrum will be released by 2020.
The government hopes to benefit from a windfall next year in a separate planned auction of 4G spectrum.
Telecoms regulator Ofcom has placed a reserve price of £1.3 billion on the 4G sale but the Office for Budget Responsibility has estimated a £3.5 billion boost to the public finances.