Britain and France have special forces operating against Islamic State in Libya too amid international efforts to unify two rival governments and loosen militants' foothold there.
"This summit is the opportunity to strengthen our close partnership," said a senior French official. "Defence is more crucial than ever because we are facing serious crises on our eastern and southern fronts."
To that end, Cameron and Hollande will announce a project to build a prototype of the next generation of unmanned drone aircraft that would be able to conduct surveillance of security threats and fire missiles at targets.
Each side is to contribute close to one billion euros.
President Francois Hollande and Prime Minister David Cameron were meeting in northern France as part of a bi-annual summit also commemorating the centenary later this year of the Battle of the Somme in which 600,000 British and French soldiers died.
Cameron was expected to also use the visit to argue that continued European Union membership will enhance Britain's security as he lobbies for it to stay in the 28-nation bloc ahead of a June 23 referendum on the issue.
Officials from both sides said part of the summit's focus would be on forging closer police and counter-terrorism ties.
France and Britain, both permanent veto-wielding members of the United Nations Security Council, are engaged in air strikes on Islamic State militants in Syria and Iraq.
Hollande and Cameron are also backers of the "moderate" Syrian opposition. They are likely to issue a new call for Syrian President Bashar al-Assad's forces and allies including Russia to stop targeting rebel forces despite a new cessation of hostilities deal and to allow more aid to reach besieged areas.