By Tim Marshall, Foreign Affairs Editor
The UK has seen an unprecedented wave of cyber attacks against its leading companies, government ministries and telecommunications sector, according to a senior Government official.
In response, the Government is setting up an operations room in London staffed by computer security experts drawn from the intelligence services and private sector.
The Fusion Cell, as it will be known, will include a giant screen showing where in the UK cyber attacks by foreign states and criminals are centred.
The information will be shared among up to 160 top British companies under the Cyber Security Information Sharing Partnership (CISP), which is being launched by Cabinet Office Minister Francis Maude.
He said: "We know that cyber attacks are happening on an industrial scale.
"Businesses are by far the biggest victims of cyber crime in terms of industrial espionage and intellectual property theft, with losses to the UK economy running into the billions of pounds annually."
The Fusion Cell will comprise about 10 officers from MI5, GCHQ and MI6, as well as men and women on secondment from some of Britain's biggest companies.
Officers from MI6 are part of the Fusion Cell teamThe Government source said that as the scale of cyber threats grew "we could see that no single organisation was big enough to oversee cyberspace".
The source added: "So the decision was taken to bring together the intelligence agencies and commercial sectors.
"We are still seeing the volume of attacks increasing and we expect that to continue. The Fusion Cell will allow us to geographically plot where the attacks are going and which sectors are being attacked."
In a pilot scheme codenamed Protect Auburn, 80 companies signed up for the scheme and began to share intelligence.
Because an attack on a commercial company can impact on its share price, the Government will only pass on information from one company to the others with the explicit permission of the company involved.
The source said the pilot scheme "showed trust growing between those involved and the volume of information shared growing".
Civilians from the private sector will be security vetted to "mid-level", but the intelligence officers present will have higher clearance levels.
Many of the companies involved are household names. They will have access to a highly encrypted web portal described as "like a secure Facebook".
It will highlight types of attack and the "signatures" of those behind it.
The launch of CISP is part of a rolling Government programme of cyber defence with funding of £650m over five years.
In parallel, MI5, the Security Service, is involved in an "outreach" programme in which it advises some of Britain's FTSE 100 companies on cyber security through the Centre for Protection of National Infrastructure.
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