Born in China, he studied at Edinburgh University, where about 80 students will receive a £5000 scholarship.
The scheme is open to Chinese students working for a masters degree in Edinburgh or for any undergraduates at the university studying for a year in China.
Education Secretary Michael Russell said: "The life of Eric Liddell, one of our greatest Olympians, is an inspiring story that featured in the award-winning film Chariots Of Fire and is an example of the links between Scotland and China.
"It is fitting that as we look to the Commonwealth Games returning to Scotland, the Scottish Government and the University of Edinburgh are honouring Eric Liddell."
Liddell broke the Olympic and world 400 metres records in 1924.
The university principal, Professor Sir Timothy O'Shea, said: "This will provide a wonderful opportunity for our students to immerse themselves in another culture and to form lifelong friendships.
"We are delighted to work with the Scottish Government in building closer links with China and look forward to meeting our first scholars later in the year."
The scholarships will be available to 20 students a year for four years.