Michel Van der Bel, area vice president and general manager of Microsoft UK, said the move would allow business customers to "innovate, compete and grow their business using the power of the cloud while adhering to strict standards and regulations like those found in banking, financial services and the public sector".
Cloud-based products offered by Microsoft, including Microsoft Azure and Office 365, are scheduled to be available from the UK data centres from late 2016, the company said.
"Built on foundational trusted cloud principles of security, privacy and control, compliance and transparency, these services will offer customers data residency in the UK, bringing world-class reliability and performance to government organisations, regulated industries and other businesses," Microsoft said in a statement.
Microsoft said that other projects to expand its existing data centre facilities in Ireland and to make its new data centre in the Netherlands operational have now been completed.
Amazon has also outlined plans to offer UK storage facilities to Amazon Web Services (AWS) customers from as early as next year.
"The AWS UK region will be our third in the European Union (EU), and we're shooting to have it ready by the end of 2016 (or early 2017)," Werner Vogels, Amazon's chief technology officer, said. "This region will provide even lower latency and strong data sovereignty to local users."
AWS already operates data centres in Dublin and Frankfurt.