Councils will be able to bid for up to £100 million of funding for each A-road they want to enhance under Department for Transport (DfT) proposals.
The creation of a major road network (MRN) will see bypasses, road widening and junction improvements on carriageways maintained by local authorities.
Some 5,000 miles of key A-roads will be included in the scheme which was put to public consultation on Saturday.
Transport Secretary Chris Grayling said: "For decades, these major local roads have been underfunded and not properly maintained.
"We are spending record amounts on improving our roads and we want more of our busiest roads to benefit from guaranteed investment.
"This will unlock no end of benefits for communities by improving motorists' journeys, taking traffic away from built up areas, as well as enabling new housing to be built and creating jobs."
The MRN will allow local authorities to take a share of the multibillion-pound national roads fund which is supported by vehicle excise duty.
Motorists drove 324 billion miles on Britain's roads in 2016, up 2.2% on the previous year.
AA spokesman Luke Bosdet said many drivers suffer a "daily nightmare" at notorious pinch points so improvements to ease traffic flow are "very welcome".
Steve Gooding, director of motoring research charity the RAC Foundation, added: "For many businesses an economically important major road is the one that runs right up to the factory gate.
"It will be interesting to see whether the business bodies consider the Government's plans to go far enough in designating the roads that matter to their members."
But Bridget Fox, sustainable transport campaigner at the Campaign for Better Transport, described the announcement as "a missed opportunity to fix local transport problems".
She claimed the Government should take a "fix it first" approach of prioritising road maintenance over bypasses and widening projects, as well as improve public transport, walking and cycling routes.
The consultation runs for 12 weeks and the strategy could be implemented in 2020.