The government has awarded a Somerset firm an £8m deal to help research and develop unmanned helicopter drones.
The Ministry of Defence said it will work with Leonardo Helicopters to see how the technology could be used to support military personnel on the battlefield.
Defence Secretary Michael Fallon described the work as "innovative".
He said it would help the military maintain its advantage in the future.
The aim is to use the expertise of workers in Yeovil to explore new technologies based on unmanned rotary wing devices.
More than 50 of the Army's "eye in the sky" Watchkeeper drones are currently based at Boscombe Down in South Wiltshire
Mr Fallon will make the official announcement during a speech on innovation at the University of Oxford on Monday.