The pop star will release the collection under the guise of her London vintage store Lucy In Disguise – which she operates with her sister Sarah Owen.
Designer Kim Jones’ sister Nadia Jones will work on the collection with Lily, merging details from the vintage details of the pieces in the store with their own designs.
Each item will be named after people and places, with designs including the Fortnums and the Capone.
UK department store Harvey Nichols will be the first place to stock the clothes, which will launch in June.
Lily – who has previously designed a collection for UK high street store New Look – recently offered fans the chance to spend a “boozy evening” at her store and take home a free handbag as part of charity Twit Relief.
She wrote on twitter: “What shall I offer up for Twitrelief? Am struggling to come up with something interesting . Ok how about, a follow, a handbag of your choice from my personal collection and a boozy evening at Lucy in Disguise for you and 4 friends . You’d all get free hire of an amazog dress. Each and I might throw in dinner too. Whadya say? (sic)”