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NSW, Queensland and WA will have to make their case to Football Australia later this year as to why they should be chosen to host the Matildas in the Asian Cup.

Sydney, Brisbane and Perth will fight it out at the end of the year to host Matildas games as well as the final of the 2026 Women's Asian Cup.

Football Australia (FA) announced on Thursday it will receive $15 million in federal government funding towards the cost of hosting the event.

FA won the rights to the tournament in May, having successfully co-hosted the 2023 Women's World Cup which drew record crowds averaging more than 30,000 per game.

NSW, Western Australia and Queensland have been named as 'host states' for the 12-team tournament, with each now required to make a case to FA and the Asian Football Confederation to land the best fixtures.

"We will move into the strategic decision-making point of the process in the back end of this calendar year, and that's when all the fun will begin," FA chief executive James Johnson told AAP.

"The next six to eight weeks it's about setting up and putting all the governance in place.

"We've got to work through that (hosting) with the states.

"You can probably expect by the end of Q3 that those discussions will be where our attention is."

The Asian Cup - which the Matildas won in 2010 - will double up as a qualification tournament for the 2027 World Cup in Brazil.

Johnson said the tournament would generate $250 million in economic value and create 1000 jobs.

The FA chief executive said the federation had noticed an explosion in female interest in the sport since last year's World Cup.

"It is our vision to deliver full stadiums across three states," he said.

"We will see a tournament on our shores broadcast to 140 countries around the world.

"Following the successful hosting of the Women's World Cup we are seeing a 20 per cent increase in participation across the country, particularly in young girls and women."