Investment funds totalling £21.5m are going to some of Britain's top universities to develop commercial uses for the "super-material" graphene.
Manchester University academics Andre Geim and Konstantin Novoselov won the 2010 Nobel Prize in Physics for demonstrating the remarkable properties of the material.
Graphene is a kind of two-dimensional carbon which is one of the thinnest, lightest, strongest and most conductive materials known to man.
Graphene atoms are arranged in a regular hexagonal pattern similar to graphite, but in a sheet one-atom thick.
A sheet measuring one metre square weighs only .77 milligrams.
The aim is to see the material put to use in a wide array of industrial and everyday applications.
Graphene could deliver potentially lucrative technological breakthroughs in areas ranging from electronics to energy generation and telecommunications.
George Osborne saw Manchester University's graphene research labs last yearThe Engineering & Physical Sciences Research Council has identified the most promising graphene-related research projects in British universities to benefit from state funding.
The University of Cambridge has been awarded more than £12m for research into graphene flexible electronics and opto-electronics, which could include things like touch-screens and other display devices.
London's Imperial College will receive over £4.5m to investigate aerospace applications of graphene, working with a number of industrial partners including Airbus.
The other successful projects are based at Durham University, the University of Manchester, the University of Exeter and Royal Holloway.
The universities will be working with industrial partners including Nokia, BAE Systems, Procter & Gamble, Qinetiq, Rolls-Royce, Dyson, Sharp and Philips Research. They will together bring a further £12m to the table.
News of the funding was announced by Chancellor George Osborne, who said: "The Government moved quickly and decisively to make sure this Nobel Prize-winning technology invented here in the UK was also developed here.
"It's exactly what our commitment to science and a proactive industrial strategy is all about - and we've beaten off strong global competition.
"Now I am glad to announce investment that will help take it from the British laboratory to the British factory floor."
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