Schools will be able to teach all subjects - except for Castilian (Spanish language) and maths - in English instead of Spanish from the start of schooling at the age of six.
The government is planning to offer free English courses to all teachers on the condition that, once they have qualified, they teach their subject in English.
In his pre-election manifesto Prime Minister Jose Luis Zapero famously promised that, if his party were elected, "all students would speak English by the time they finished compulsory education".
Announcing the reforms, education minister Maria Jesus San Segundo said learning a foreign language was the "alphabet of the 21st century".
Bilingual schooling is already being put into practice in several autonomous regions notably Madrid, Andalucia and the Basque Country, with positive results. Madrid has 26 schools where certain subjects are taught in English and 50 more follow suit next year. Andalucia will start similar measures in 100 schools at the beginning of the next school year rising to 400 schools within four years.
Government figures show that seven million Spaniards are studying English in state schools - but traditional classes are not producing results.
Surveys show 62 per cent of 15 to 20 year-olds say they cannot hold a simple conversation in English.
The main problem is class-sizes: it is difficult to take a practical language lesson for classes averaging 25 students in primary school, 30 in secondary and up to 38 in the bachillerato (sixth form). Other European countries split classes in two for languages.
The Spanish are traditionally bad at foreign languages. According to the latest Eurobarometer, 53 per cent of Spaniards (well over the European average of 47 per cent) confess to not speaking any foreign language.
The equivalent figure in Luxembourg is 2 per cent; but the United Kingdom fares even worse than Spain at 66 per cent.
The shortfall has led to a boom in private English schools and an uneven playing field where only those who can afford such tuition can get better jobs, where English is required.