Information packs about the Rolls-Royce science prize, which is being supported by The TES, are being sent to 35,000 schools and colleges in the UK and Ireland.
Teams at each school or college entering will be asked to draw up a science teaching proposal in the first year of the award. The following year, they will receive financial help to implement the plan over two terms.
The winning team will receive pound;15,000 to invest in science education, while the second-placed team will win pound;10,000.
All the proposals will be loaded on to a database of educational ideas, accessed through the Rolls-Royce website (www.rolls-royce.com).
Sir John Rose, chief executive of Rolls-Royce, said: "We need talented young scientists and engineers to ensure we remain competitive. Recent statistics show a worrying decline in the number of students studying science, engineering and technology subjects."
From 1991 to 2003 the number of pupils studying A-level physics fell by 30 per cent, with falls in maths of 25 per cent, and of 19 per cent in chemistry.
Bob Doe, editor of The TES, said, "We applaud Rolls-Royce's generous support for science education. It's vital that teachers devise and share more creative ideas for improving teaching and learning."