Chief Secretary to the Treasury Steve Barclay unveiled the extended funding and claimed it would allow Westminster to target areas requiring funding directly.
Scotland, along with Wales and Northern Ireland, will now all benefit from at least £800 million of investment for things such as high street regeneration, local transport, cultural and heritage projects.
Mr Barclay said: “We are committed to levelling-up opportunities right across the United Kingdom so that all communities can benefit from our future prosperity.
“Our levelling-up fund will back local projects to improve everyday life for millions of people and we look forward to working with all areas to boost local economies.
“By extending the levelling-up fund to be UK-wide, we are ensuring that no community in the United Kingdom is left behind.”
The Levelling Up Fund was first announced at the Spending Review and will run from 2021/22 to 2024/25.
It will be targeted at areas considered in need, those facing particular challenges, or those that have received less government investment in recent years.
The Scotsman understands the scheme will allow Boris Johnson’s Government to invest directly in areas across the UK without needing to go through devolved administrations.
Scottish Secretary Alister Jack said: "The new UK Levelling Up Fund is a fantastic example of the UK Government delivering for people in Scotland. It will provide a boost to communities right across Scotland as we set out to ‘Build Back Better’ from the Covid pandemic.
"This fund will allow us to directly invest in capital projects in Scotland. I look forward to working on the delivery of the fund in Scotland and with local authorities, who know best what their communities really need.
"The new UK Levelling Up Fund is just one way the UK Government is investing in Scottish jobs and Scotland’s future prosperity.
"We are driving a package of measures to level up opportunity across all parts of the UK, including City and Region Growth Deals, freeports, the Union Connectivity Review and preparing for a new UK Shared Prosperity Fund.”