The project will run over the next two years and work with 1,500 women and their families.
Silk production in Afghanistan goes back two thousand years and the silkworm project will be based in Herat, western Afghanistan, which was once a stop on the ancient Silk Road trade route.
The women participating in the project are either widows or from women-headed households but all face a daily battle with poverty.
They will be given silkworms and trained to cultivate the silk cocoons. Work will also be carried out to improve the efficiency of processing centres, where the cocoons are spun into silk thread.
Some of the women will receive looms and additional training to produce silk goods like scarves and handkerchiefs to sell in the local market.
In addition to giving the women key skills, the project will enable them to secure a living that can be used towards better healthcare and education.
Profits will be ploughed back into silk production to ensure a long-term future for the women that is not reliant on aid.
Olivia Lankester, Head of Corporate Responsibility for Monsoon said: "Monsoon started out sourcing hand embroidered silk kaftans from Afghanistan and so this new venture, helping women to revive the silk industry in Afghanistan, is the perfect way to celebrate Monsoon's 40th anniversary this year and build a better future for thousands of families.
"We have decided to work with Christian Aid because they operate through experienced local partner organisations who know how to empower local communities, have had a presence in the country for almost three decades and therefore are ideally placed to run the project for the Monsoon Accessorize Trust."
Christian Aid has already been helping thousands of women in Afghanistan generate income through the harvesting of silk cocoons from silkworms in their own homes.
Serena Di Matteo, Christian Aid Country Director said the new support from Monsoon would enable the existing project to reach even more people.
"Women suffered under the Taliban by not having access to education or given the freedom to make a living – the silkworm project provides them with a way to make a living, improve their role in society and therefore provides them with a future that they would not have had before," she said.
"After 30 years of conflict the Afghanistan economy has suffered, and with the international community pulling out the economy will continue to suffer.
"Market development projects which revive existing crafts such as silk production are critical to provide jobs for the most vulnerable and boost the country's economy."