Gordon Brown said the government will "modernise its interception capability" to tackle the growing threat of state-sponsored cyberattacks.
Announcing the publication of the first National Security Strategy for the UK yesterday, the Prime Minister said the government will invest in IT to boost Britain's cyber-defences.
Terrorism, nuclear attack, natural disasters and international crime are among the emerging security threats the document details, but it also mentions large-scale cyberattacks - like that which hit Estonia in 2007.
The Cabinet Office paper says state-sponsored or terrorist cyberattacks are a growing threat and the internet is a target for attackers.
"As economies and societies grow increasingly dependent on national and global electronic information and communication systems, it becomes even more important to manage the risk of disruption to their integrity and availability through cyberattack, whether terrorist, criminal, or state-led," it stated.
"Diversity of systems can provide resilience, but can also lead to increased complexity and interdependence, making the whole more vulnerable to attacks or accidental shocks."
Brown said a new approach to national security was needed. "New threats demand new approaches," he said. "A radically updated and much more coordinated response is now required.
"I can confirm that to meet future security needs we have set aside funds to modernise our interception capability; that at GCHQ and in the secret intelligence service we are developing new technical capabilities to root out terrorism; and that the new Centre for the Protection of National Infrastructure set up last year will provide a higher level of protection against internet or cyber-based threats."
The document also said the government will work with international public and private sector partners to protect its critical national infrastructure, such as utilities, from cyberattack. However, it does not provide specific details of where funds will be invested.