It will be for local authorities to allocate this fund against the themes of the Town Centre Action Plan.
The money will fund a wide range of investments which will make town centres more vibrant, enterprising, and accessible.
This could include the re-purposing of empty buildings for housing or social and community enterprises.
Speaking as he announced the launch of the fund, Economy Secretary Derek Mackay said: "Town centres are facing challenges across Scotland in adapting to a changing retail climate, and it is important that we help them to diversify and adjust to overcome these challenges.
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"I want to make sure we can keep life in our high streets, and ensure they continue to be thriving places for communities to live, work and enjoy.
"This £50 million fund will enable local authorities to stimulate and support a wide range of investments which will encourage town centres to diversify and flourish, and create an increase in footfall through local improvements and partnerships.
"It is part of a wider boost to the economy through providing more than £5 billion of capital investment to grow and modernise Scotland's infrastructure, and a wider package of support to businesses, including maintaining a competitive business rates package and providing the most generous package of non-domestic rates reliefs anywhere in the UK."
Councillor Steven Heddle, COSLA's Environment and Economy Spokesperson said: "Local Economic Development drives so much of the other vital things that Councils do on behalf of our Communities. This was a message we promoted as part of our essential services campaign ahead of this year's budget. We were clear that inclusive growth must be supported through investment in Local Government.
"We welcome today's announcement of the £50 million for investment in our towns and we will continue to work with Scottish Government on our shared priority of Inclusive Growth and growing Scotland's Economy."
