Health Secretary Jeremy Hunt will today pledge £50 million to help hospitals and care homes create more dementia-friendly environments.
The funding will be used to create calming surroundings which will help avoid confusion.
The money could be used for hi-tech sensory rooms or specially adapted outdoor spaces.
Or it could be used for simple measures such as creating large print signs or providing photos of local scenes from years gone by to help people feel connected to their past.
Local areas can bid to receive part of the funding for their services over the next few months, with the adaptations expected to begin in April next year.
The Health Secretary will also outline his ambition to make England the best place in Europe to grow old.
He is expected to say that improving care for dementia sufferers is one of his top priorities.
There are currently 800,000 people with dementia in the UK and 670,000 family and friends acting as primary carers, according to the latest estimates from the Alzheimer's Society.
The number of sufferers is estimated to rise to a million by 2021, and 1.7 million by 2051.
The new plans however have been attacked by Labour - who say severe cuts to council budgets mean services and standards are getting worse.
What is dementia?
The term 'dementia' is used to describe the symptoms that occur when the brain is affected by specific diseases and conditions.
Symptoms of dementia include loss of memory, confusion and problems with speech and understanding.
There are many types of dementia. The most common are Alzheimer's disease and vascular dementia.
Dementia is progressive, which means the symptoms will gradually get worse.
For more information about dementia visit the Alzheimer's society website.