Cooper told the Labour Party conference that she is looking for "the world's best architects and designers" to develop the plans. She added that the government could deliver more than a million zero carbon homes by 2020.
Further details and timescales for the competition will be finalised next month, the DCLG confirmed.
The move follows premier Gordon Brown's revision of the planned number of eco-towns from five to ten (Planning, 28 September, p3).
Around 30 authorities and developers have made bids, with a month left before the deadline. The ten winners will be named in March.