Communities in England will get the power to decide where shops, offices and homes are to be built, the government will announce.
Under the plans, local referendums will be held, which could force councils to adopt "neighbourhood plans".
The government will also offer financial incentives to encourage the "right kind of development".
Communities Secretary Eric Pickles said this would mean "more people-planning and less politician-planning".
Mr Pickles said: "For far too long local people have had too little say over a planning system that has imposed bureaucratic decisions by distant officials in Whitehall and the town hall.
"We need to change things... so there is more direct democracy and less bureaucracy in the system. These reforms will become the building blocks of the Big Society."
The Localism Bill, to be unveiled later, says residents can set out an overall plan for development in their area, which will then be voted on in a referendum.
This will allow voters to decide where building takes place and which green spaces should be protected.
Councils will then have to adopt the neighbourhood plans, which would be put on a "fast track" to approval, meaning urgent projects can short-cut the system.
The government is asking for 12 local authorities to volunteer to take part in trials.
Greg Clark, minister for planning and decentralisation, added: "We want local people to be able to make more of their own choices about what their home town should look like in the future. These reforms offer a scope for self-determination unheard-of until now.
"Localism in planning will create the freedom and the incentives for those places that want to grow, to do so, and to reap the benefits. It's a reason to say 'yes.'"
Last month, Mr Pickles lost a court battle over his decision to scrap the last government's regional housing targets in England.
The move was ruled unlawful by the High Court after housing developers had asked the court to block it, arguing the communities secretary had abused his powers. An aide said that no appeal was planned but it would make little difference as the changes would be introduced through legislation next year.