The former Celtic and Aston Villa midfielder was forced to give up the game earlier this year after being diagnosed with the disease in March 2012.
And as part of the foundation's launch, the Bulgarian, who is now in remission, will host a match between a Celtic XI and a Stiliyan XI at Celtic Park on Sunday, September 8.
Admission to the ground will be £10 for adults and £5 concessions and 'Stan' is hoping to see the 'house full' signs at Parkhead on the day of the match.
"I have been given a great opportunity from Celtic to start my foundation with a game here at Parkhead," he told Sky Sports News.
"Obviously all the money will be split between two or three different charities and I hope we will raise enough money to start the foundation and to make a difference right from the start.
"I also hope that it will be a full Celtic Park for the game, just as it has always been."
Also raising funds for the foundation are members of the Celtic staff who have volunteered to jump out of a plane at 10,000 feet in a tandem 'SkyDive for Stiliyan'.
The event will take place on Sunday, August 25 (subject to weather) at Skydive St Andrew's in Glenrothes, Fife, with the net proceeds donated to Petrov's nominated charity.