Following the success of Bristol's Gromit trail in 2013, each city will feature its own flock of 60 sheep, decorated by celebrities and artists.
Shaun in the City launches in London next March, following the release of Aardman's Shaun the Sheep The Movie.
A second trail will be displayed in Bristol in July and August.
Each eight-week trail will feature the 5ft (1.52m) high sculptures, displayed in central or famous locations around the two cities.
Following both trails, the sheep will be sold at auction to raise money for sick children in hospitals across the UK in autumn 2015.
Last year's Gromit Unleashed trail raised Â£3.8m for the Bristol Children's Hospital Charity. Organisers calculated 1.18 million people saw the 81 dog sculptures, with about 900,000 visiting the city specifically to see them.
Both Shaun the Sheep and Gromit are the brainchilds of Bristol-based company Aardman Animations.
Shaun the Sheep was recently voted the nation's favourite children's TV character in a poll, conducted by the Radio Times and the British Film Institute.
The Aardman character, who made his debut in 1995 short film Wallace and Gromit: A Close Shave, was given his own series in 2007 and makes his film debut next year.
"The Shaun in the City trail means so much to me," creator Nick Park said.
"I am particularly looking forward to working with so many talented artists and seeing how they will use Shaun as their canvas."
Up to 120 giant sculptures, depicting Shaun the Sheep in a variety of guises, will form a major public arts trail across London and Bristol next year.