The scheme, which would draw on smart-card technology, represents the first attempt to ban cars from a large city areas for reasons other than security.
Environment secretary John Prescott has still to see details of the plans, but officials at the department of transport, environment and the regions are said to be impressed by it.
One problem facing the corporation is the existence of a law that allows vehicles free access to the highway. But DETR officials said there would be nothing to stop the London scheme being tested for 18 months.
Under the plan, a form of area licensing would be introduced for essential vehicles such as cabs and buses. A copy of the plan says: 'Area licensing could be introduced using smart-card technology installed at the zone access points or some other acceptable method such as windscreen permits.'