The new plan shifts the balance of presumption in favour of organ donation, with an opt out for those who do not wish to take part, the Department of Health and Social Care said.
The changes will be known as Max’s Law after Max Johnson, a 10-year-old boy who was saved by a heart transplant.
Currently, would-be donors must indicate their intentions on the NHS Organ Donor Register, or grieving families must make the decision if a patient’s wish to donate is unknown.
While research shows that 82% of people in England support organ donation, only 37% have indicated so on the register.
And less than half of families give consent for their loved one’s organs to be donated.
The proposed law will aim to close this gap, and is expected to be rolled out by the Government in Spring 2020.
Jackie Doyle-Price, parliamentary under-secretary of state for mental health and Inequalities said: “Organ donation saves lives.
“We believe that by making these changes, we can save as many as 700 more lives every year.
“But organ donation remains a gift.
“I want to encourage people who wish to give life in the event of their death to take the time to record their wishes and discuss it with their family.
“However, we know this new system alone is not a magic bullet.
“We need to address myths and misconceptions around donation, and we will only do this by having informed debate and dialogue, which I hope will be fostered by these proposals.”
Under-18s, people with limited mental capacity and others who have not lived in England for at least a year prior to their death will be exempt from the scheme.
It follows a consultation earlier in 2018 which drew 17,000 responses from the public.
The legislation, which was introduced in Parliament in July 2017, will return to the House of Commons in the autumn.
Those who do not wish to donate can record this on the NHS register either online, by phone or on an app to be released by the end of the year.
A 12-month transition period will pave the way for the launch.
Some 411 people in the UK died on the transplant waiting list in 2017.
Simon Gillespie, chief executive of the British Heart Foundation, said: “There is a desperate shortage of organ donors in the UK.
“Introducing an opt-out system in England will better reflect the views of the general public and give hope to those currently waiting for a transplant they so desperately need.”