He made the commitment at the Global Call to Protect Religious Freedom event at the UN General Assembly on Monday.
Mr Trump said: "Each of us has the right to follow the dictates of our conscience and the demands of our religious conviction."
On top of announcing the new $25 million fund, the president outlined efforts by his administration to protect victims of all faiths from religious violence.
They include hosting a summit on combating anti-Semitism in July, providing humanitarian aid to help Christians and Yazidis who suffered at the hands of ISIS and helping Rohingya Muslim refugees fleeing persecution.
He highlighted that Christians are the most persecuted religious group in the world and his administration is "deeply concerned" for the more than 1 million Uighurs, a minority Turkic ethnic group, interned in Chinese internment camps.
Mr Trump added: "The United States in funded on the principle that our rights do not come from government, they come from God.
"Our founders understood that no right is more fundamental to a peaceful, prosperous, and virtuous society, than the right to follow one's religious convictions."
The speech made Mr Trump the first US president to address religious freedom at the United Nations.
Over 150 foreign leaders, faith leaders, victims of persecution and religious freedom activists were in attendance.
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