The 'Faith Partnership Principles' were launched by Secretary of State, Andrew Mitchell, at the official residence of the Archbishop of Canterbury, Lambeth Palace.
The document has been produced by DFID to build greater common understanding, mutual respect and cooperation in overcoming poverty.
DFID said it would work with faith groups to identify three priority countries for collaborative learning and action.
It also wants to facilitate an inter-faith forum for debate, and keep faith groups informed about funding opportunities.
The paper states: "In many countries, and for many people, faith and religion are central to development â¦ Faith enables them to understand and relate to the world."
Writing in the foreword, Mr Mitchell acknowledged that faith was making an important contribution to development.
"Faith groups are doing excellent work in providing not only humanitarian relief, but delivering health, education and other services in some of the most troubled parts of the world," he said.
"I look forward to the closer partnership with people of faith who play a unique role in fighting poverty."
Development organisations from across the faith spectrum contributed to the guidelines.
The Archbishop of Canterbury, Dr Rowan Williams said, "What we share with each other as faith communities is a vision of humanity that speaks not just of rights but of the honour due to human beings, an honour that informs and drives our commitment to international development.
"The distinctive contribution of faith-based organisations and faith communities in the humanitarian and development arena is increasingly recognised.
"I believe that there is great potential in promoting mutual understanding, critical engagement and collaborative action between governments, civil society and faith communities in promoting global justice and sustainable development."