Grammar schools in England will receive £50m to create new places - and a route has been opened to create new faith schools, Education Secretary Damian Hinds has announced.
But the government has ditched its original plans to make it easier for religious groups to open free schools.
Instead local authorities will have funds to open new faith schools.
Mr Hinds said the plans would "give parents greater choice", but union leaders have criticised the decision.
Kevin Courtney, leader of the National Education Union, said: "The grammar school corpse has climbed out of its coffin once again despite evidence of the damage that selective education causes."
What is a grammar school?
Grammar schools are state secondary schools that select their pupils by means of an exam taken by children at age 11, sometimes known as the 11-plus.
There are 163 grammar schools in England, out of some 3,000 state secondaries, and a further 67 grammar schools in Northern Ireland.
There are no state grammars in Wales or Scotland.
The government's loss of its parliamentary majority in the general election meant abandoning plans to open new grammars - but the allocation of the funding will allow more selective places to be created in existing schools.
Grammar schools seeking money from the "selective schools expansion fund" will have to show they ensure fair access for disadvantaged pupils.
It will allow grammars to grow bigger or to develop spin-off sites.
source:www.bbc.com
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