Every dog in the country will have to be microchipped under new plans to reduce the number of strays.
The law will come into effect on April 6, 2016, and any owner whose dog is found without a chip could face a fine of up to £500.
Microchipping allows police and local authorities to trace owners if their dogs have been involved in an attack.
But it also enables animal charities such as the RSPCA and Battersea Dogs' Home to easily contact the owners of lost or abandoned pets.
The new law could also remove a legal loophole which prevents owners being prosecuted when dog attacks take place on private land.
Environment Secretary Owen Paterson, who announced the new law this morning, said: "It's ludicrous that in a nation of dog-lovers, thousands of dogs are roaming the streets or stuck in kennels because the owner cannot be tracked down."
Local authorities and the police will be responsible for enforcing the law but vets will also be asked to remind owners to microchip their dogs.
Microchipping is not a new concept in Wandsworth, because, since 2009, it has been a compulsory condition of social housing tenancy agreements.
Wandsworth Council was the first of its kind to introduce such a measure and since then more than 5,000 dogs have been chipped in the borough.
Councillors have been calling on the Government to introduce new ownership rules, including compulsory microchipping and dog licences, since 2007.
The problem of 'dangerous dogs' arose in Wandsworth six years ago when there were a number of vicious attacks on either owners, members of the public or other dogs.
Councillor Jonathan Cook, Wandsworth’s community safety spokesman, said: "Today’s announcement is a significant boost to our ongoing campaign for responsible dog ownership.
"The borough’s compulsory microchipping policy for housing estate tenants and leaseholders’ dogs has already seen the number of complaints about dog attacks fall – and this next step will surely reduce such incidents even further, as owners know they can be easily traced if they cause problems."
Since then 22 illegal breeds have been seized, resulting in the successful prosecution of all the dogs' owners.
One victim John Boswell, 49, whose jack russell was killed in Putney, backed the new law.
He said: "I still have numbness in my hand from the attack and I never walk my new dog at night.
"Police caught the dog, and it was destroyed, but if it had been microchipped they might have caught the owner.
"Hopefully this law will mean more people will be prosecuted if the same thing happens to them."
Battersea Dogs' Home, who have backed the new law, will offer free microchipping to help encourage those dog owners who have not yet got their dogs chipped.
Claire Horton, the charity's chief executive, said: "Battersea warmly welcomes today’s Government announcement on microchipping in England as it will make a real difference to the welfare of dogs.
"Having no chip in a dog can mean any reunion can take days to happen, if it happens at all."
The RSPCA welcomed the proposals, but said it doubted that they alone would "make owners more responsible or ensure fewer dogs bite people".
Microchipping Factbox - There are about 8m dogs in the UK at present, yet just 58 per cent of the UK’s dogs are chipped (source: Petlog).
- In 2011 only 28 per cent of the dogs arriving at Battersea Dogs' Home had been microchip.
- Eight children and six adults have been killed in dog attacks since 2005.
- More than 3,000 postman have also been attacked since 2005.
- The chip itself is the size of a grain of rice and is inserted between the shoulder blades of a dog using a sterile needle.
- It is coated in a bio-compatible glass, the same material used in human pacemakers, and it fuses to the dog's bodily tissue.