Transport Secretary Lord Adonis made the announcement. The recommended route is from London to Birmingham, with a future extension to Scotland and northern England.
The proposal will be presented to the public, and work will not begin until 2017 at the earliest.
Lord Adonis told the House of Lords that a high-speed rail can "drive economic growth and boost jobs," but that an "extensive and detailed" consultation would first be needed.
"Subject to this consultation, the London terminus for the high-speed line would be Euston, the Birmingham city centre station would be at Curzon Street, and there would be interchange stations with Crossrail west of Paddington and near Birmingham airport," he said.
Lord Adonis said the rail project would create about 10,000 jobs and the first 120 miles would cost between £15.8bn and £17.4bn.
Shadow transport secretary Theresa Villiers, however, said if Conservatives are elected into power, they would start work on the rail 2 years earlier, in 2015.
Michael Roberts, chief executive of the Association of Train Operating Companies (Atoc), said: "The commitment that all three parties have shown to [high-speed rail] is a vote of confidence in the industry, and will help place train travel at the heart of a successful low-carbon economy.
