The money will be given to 17 projects across England. It will be spent on increasing the number of beds available to children and young people aged 18 and under.
Across the 17 projects 59 new beds are to be created. In addition 45 beds will be relocated and 52 refurbished.
In some cases the money will also be used to buy equipment and support community-based services.
In November 2006 the government pledged to eliminate the use of adult wards for under 16s within two years.
Announcing the £31m, health minister Ivan Lewis said: “Vulnerable children deserve age-appropriate services that recognise, irrespective of their condition, that they are first and foremost children.”
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