Interior Secretary Ken Salazar said the government was putting 38.6 million acres offshore Alabama, Louisiana and Mississippi on the auction block March 20.
"Exploration and development of the Gulf of Mexico's vital energy resources will continue to help power our nation and drive our economy," he said in a statement.
The government estimates the acreage could lead to the production of as much as 1 billion barrels of oil and 4 trillion cubic feet of natural gas.
U.S. President Barack Obama last year unveiled a five-year lease program for the outer continental shelf. The Interior Department's Bureau of Land Management generated $233 million through the sale of 1,707 parcels totaling 1.4 million acres in onshore oil and gas leases last year.
The March 20 auction, scheduled for New Orleans, is the second under the five-year plan. The Interior Department said it covers all of the unleased acreage in U.S. territorial waters of the central Gulf of Mexico.