People holding street parties over the Queen's Diamond Jubilee long weekend from 2-5 June, can win £100 worth of Co-operative vouchers to put towards the food, alongside a party pack including bunting, paper cups and plates, and Union Jacks.
Rival retailer Sainsbury's has heavily invested in marketing activity around the Queen's Diamond Jubilee, through a sponsorship of the river pageant and the hosting of a festival in Hyde Park.
Meanwhile, Marks & Spencer (M&S) is subtly trying to associate itself with the Jubilee with a star-studded summer campaign.
Party organisers can apply for the Co-operative party fund by explaining why their community has decided to host a street party, on the retailer's Diamond Jubilee microsite.
The most touching and community focused entries will be handed the funds, while the competition will run until 30 April.
The Co-operative is marking the Diamond Jubilee with a range of new products, including a teddy bear gingerbread biscuit sporting a Union Jack T-shirt, and limited-edition doughnuts decorated with red, white and blue sprinkles.
The retailer will also be introducing two limited-edition, premium own-brand British beers, named 'Jubilation' and 'Salutation', which will be in store from 2 May.
Helen Nunn, head of marketing for The Co-operative Food, said: "They are great neighbourhood occasions and, as a retailer at the heart of the communities in which we trade, we're getting behind the Jubilee celebrations at a local level, with a helping hand to make people's street parties extra special and memorable."
Follow Matthew Chapman at @mattchapmanUK