London Underground will run weekend services 24 hours under plans that also involve ticket office closures and up to 750 job cuts.
The Night Tube will provide services on the Piccadilly, Victoria, Central, Jubilee and Northern lines.
But Transport for London (TfL) said every ticket office would close by 2015, resulting in the job cuts.
The RMT union said it had "not ruled out" strike action in the run-up to Christmas over the "lethal" cuts.
For action to take place the RMT (Rail, Maritime and Transport Union) would have to hold a two-week ballot and give TfL seven days notice.
In a tweet, the BBC's transport correspondent Richard Westcott said: "RMT just told me they haven't ruled out calling for strikes b4 Christmas on the #londonunderground"
The transport authority is facing a budget reduction of about £78m in the financial years of 2013 and 2014 and said the plans would help it save more than £40m a year.
TfL says six major central London stations will have special customer points to help tourists and that every station will be staffed while the tube is running, with workers moved out of ticket offices into station booking areas.
It is also promising:
- Wi-fi coverage across all below-ground stations
- Disabled access at a further 27 stations
- Contactless bank card payment to make it easier to pay for tickets
- More new trains and updates for stations
The initial plans for the 24-hour Night Tube include overnight trains on Friday and Saturday, with plans for it to expand over subsequent years.
Mayor of London Boris Johnson, said: "This is just the first stage in an opening up of the tube network to become 24 hours.
"For 150 years the Tube has been the beating heart of London, its tunnels and tracks providing the arteries that have transported millions of people and helped to drive the development and economic growth of our great city."
London Underground will now go into a 90-day consultation on its proposals but says there will be no compulsory redundancies and has promised that every member of staff who wants a job and who is "ready to be flexible" will have one.
The managing director of London Underground Mike Brown, said: "All Tube stations will continue to be staffed and controlled in future, with more staff visible and available to customers."
But the RMT, which represents most of the station staff who would be affected, has said it would "fight these plans with every tool at our disposal and that includes political, public and industrial campaigning on an unprecedented scale".
RMT General Secretary Bob Crow said the "proposed cuts will decimate staffing levels and hit the most vulnerable users" of Tube services.
He said: "The mayor must believe he is some sort of magician if he thinks he can slash a thousand jobs and still run safe services when everyone knows that staffing has already been cut to the bone while passenger demand continues to rise.
"Throwing in the plan for night time operation at the weekends is just a smokescreen to try and camouflage the real issue which is a savage cuts to jobs, access and safety."
Manuel Cortes, leader of the Transport Salaried Staffs' Association rail union, accused the mayor of being the "hypocrite of the decade".
He said: "It beggars belief that the mayor, who was elected in 2008 on a pledge to keep open every ticket office, is now planning to close every single one, with all that means for safety and jobs.
"We shall be launching a joint campaign with Labour to reverse this decision."
Customers have expressed concern over the ticket office closures but broadly welcomed the 24-hour service.
Garvie Gay, 36, from Bedford said he regularly needed help from counter staff.
He said: "It's not good because I don't know where I'm going half the time. I've not really got a clue but for regulars I suppose it wouldn't be a problem."
In March, BBC London reported TfL is facing a 1% cut in its government grant this year, and 2% the following year.
In cash terms, it means a loss of £33m for 2013-14, and £45m for 2014-15.
In January, passengers saw a 4.2% increase on average in fares across the Tube, buses and trams.