Ofcom will sell off more of the publically-owned radio spectrum in a move which could provide wider 4G mobile coverage in the UK.
The auction will see chunks of the 2.3 GHz and 3.4 GHz bands sold off late in 2015, with the frequencies capable of carrying high-capacity data suitable for 4G.
Smartphones from Apple, Samsung and HTC already operate on the 2.3 Ghz spectrum internationally and 4G has been rolled out across the 3.4Ghz band in Canada and Spain.
A total 190 MHz of spectrum, some of which is currently used by the ministry of defence, will be made available to potential bidders in 38 lots of 5 MHz.
Philip Marnick, director of Ofcom Spectrum Group, said: "Today marks an important step in ensuring that the UK has sufficient spectrum to support our wireless economy.
"It comes in response to the fast pace of change and innovation taking place in the communications sector, which is placing increased demands on how spectrum is used by all industries. One important way of meeting this demand is making new spectrum available and its use as flexible as possible."
A previous spectrum auction in 2013 provided £2.3bn for Ofcom with EE, Hutchison 3G UK, BT subsidiary Niche Spectrum Ventures, Telefónica UK and Vodafone all taking a slice.