Comrie, near Crieff, is undertaking a street-by-street home insulation project in partnership with Scottish and Southern Energy, which will also save householders money on their heating bills.
The community is also looking at the sustainable development of nearby land, composting, food production and a local transport plan.
The Comrie Development Trust has received almost £300,000 from the Climate Challenge Fund, supported by the Scottish Government along with the Scottish Green Party.
Cabinet Secretary for the Environment Richard Lochhead said: "This is a superb example of what can be done with the funds available from the Climate Challenge Fund.
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"This project is enormously wide-ranging and there is much for the people of Comrie to be proud of.
"Such a radical move represents commendable action and there is much to be learned from their innovation. The street-by-street home insulation plan is particularly striking, cutting carbon emissions and helping residents make significant savings on their heating bills."
Mr Lochhead urged communities across Scotland to look at what is happening in Comrie and to think about how they could follow suit.
Patrick Harvie MSP of the Scottish Green Party said: "Where Comrie leads, we believe the rest of Scotland will follow. Properly insulating our homes is the best way to tackle fuel poverty, improve health, and beat climate change all at the same time. In particular, this kind of comprehensive programme brings real benefits for the community, is far more cost efficient, and has a much better chance of delivering savings than narrowly targeted alternatives.
"We're also delighted to see Scottish and Southern Energy playing such a constructive role in this project. They realise that energy companies will have to help deal with the three key problems of climate change, fuel poverty and our dependence on fossil fuels, and I am confident they will play their part."
(GK/JM)
