The idea for the foundation, to be called the Amy Winehouse Foundation, was conceived by Mitch Winehouse to "to help the things she loved - children, horses, but also to help those struggling with substance abuse."
Announced during her eulogy at her funeral in London, the foundation will be set up through the help of Member of Parliament Keith Vaz.
The purpose of the Amy Winehouse Foundation will be to provide help and support for anyone suffering from drug related problems and could possibly include the induction of a rehabilitation center.
"In this country, if you cannot afford a private rehabilitation clinic, there is a two year waiting list for help," Mitch Winehouse said in a statement. "With the help of Keith Vaz MP, we are trying to change that."
The foundation will also benefit children and horses, two of Amy Winehouse's passions.
According to her father, Amy Winehouse had kicked her drug addiction three years before her death.
"The doctors said it was impossible but she really did it. She was trying hard to deal with her drinking and had just completed three weeks of abstinence," he said.
Recalling a statement made by Amy Winehouse before her death, Mitch Winehouse said, "She said, 'Dad I've had enough, I can't stand the look on your and the family's faces anymore.' She was not depressed... She was the happiest she has been for years."
The privately held funeral took place on Tuesday for the singer's family and close friends. It was held in typical Jewish tradition at Edgware Cemetary in North London followed by a cremation at Golders Green Crematorium.
During the eulogy Mitch Winehouse spoke to his daughter, "Goodnight, my angel, sleep tight. Mummy and Daddy love you ever so much. He also prompted closure saying, "Knowing she passed away happy, it makes us all feel better."
While her father reports speaking to a happy Amy Winehouse the night before her death, an autopsy to determine the cause of death had inconclusive results. A toxicology report to determine the cause of death will be released in upcoming weeks.
Amy Winehouse was found dead July 23 in bed in her London flat.
While the cause of death is unknown, sources say Amy Winehouse had bought a surplus of drugs the evening before, though this is not an official report.
The singer publicly battled with drug and alcohol abuse for years, which even warranted creation of one of her hit songs entitled "Rehab."