The strategy, which has been developed in partnership with elements of the food and drink industry, aims to improve the industry's environmental, social and economic performance by developing a strong partnership between government and industry.
Closer working between industry and Government best practice programmes, such as the Carbon Trust, Envirowise and the Waste Resources Action Programme, will underpin the strategy.
In addition, industry-led Champions' Groups will help to take forward work on. Energy, water, waste, social responsibility and ethical trading boards will be established under Lord Bach, minister for sustainable farming and food, to oversee the strategy's implementation.
"Long term sustainability remains the industry's goal," said FDF director general Melanie Leech. "The launch of this strategy marks an important milestone towards a joined-up approach across the food chain.
"Food and drink manufacturers are ready and willing to play their part in helping to take FISS forward, in particular to working with Defra and industry partners in the new Champions' Groups."
The strategy also aims to drive up performance in the areas of ethical trading, health and safety and equal opportunities.
Priorities include doubling the amount or percentage of food in supermarkets covered by ethical trading schemes by 2008 and halving the level of under-representation of women and ethnic minorities in skilled and administrative and managerial grades in the industry by 2010, benchmarked against their representation in the labour force.
"As an industry the food sector has a significant role to play in achieving a sustainable future for this country," said Margaret Beckett, secretary of state for the environment, food and rural affairs (Defra).
"There are many ways this can be done - whether it is by minimising packaging, making food transportation more efficient or reducing the amount of water the industry uses in its processes.
"Sustainability requires behavioural changes, in particular the widespread adoption of best practice. We all have a role to play in meeting the challenge of sustainability."
Set targets for the food industry include a reduction in carbon emissions by 20 per cent by 2010 against a 1990 baseline; a reduction in water use by 10 to 15 per cent by 2010 and a significant reduction in the environmental and social costs of domestic food transportation by 2012.
"UK food and drink manufacturers have long recognised the importance of progress towards sustainable development," said Leech.
"We welcome Defra's recognition of the industry's work to date."