Rural and popular schools will get an extra teacher if parental choice forces infant class sizes to rise above 30.
When the 31st child arrives, local authorities will have to provide a teacher using Government money set aside for reducing class sizes.
Stephen Byers, the school standards minister, said: "By September 2001 no child will be in a class of more than 30 pupils and where possible in their preferred school.
"For example, in rural schools extra money will be provided for a new teacher so that a child can attend their local school in a class of 30 or fewer and not be forced to travel an unreasonable distance to go to a school which has empty places."
He said extra teachers and additional capital resources will be concentrated in schools which are popular with parents, so that more children can attend, but with smaller classes.
Parents will be able to send their child to the preferred school if they can demonstrate that the alternative is either failing or compares unfavourably - as shown by key stage 1 and 2 test results and inspection reports.
Last week 65 education authorities received a share of pound;22 million to cut class sizes. This money can only be spent on teachers and not on building new classrooms.
One local education authority office said: "We do welcome the money, but if we have to create a number of extra classes because of parental demand, then we are going to have to put children back into the huts we've been trying to phase out."
Warwickshire received pound;584,000 and has a large number of rural schools. Elizabeth Wylie, deputy chief education officer, said: "We are expected to make the maximum impact for the minimum expense, therefore we will be concentrating on schools where it will be easiest to create new classes if necessary.
"It may mean some hard choices for heads and governors, but the message we have from the Government is that we have to make it work."
Margaret Smart, director of the Catholic Education Service, said: "While we and the Church of England strongly support the principle of reducing class sizes we believe it may be very difficult to implement."
A local authorities' spokesman said the Government's strategy lacked flexibility. Employing an extra teacher when child number 31 arrived would cost a minimum of pound;18,000 a year. Some heads and governors believe they can keep class sizes down with the help of well-trained classroom assistants andor a "floating" teacher, he said.
He also predicted the policy of allowing parents a preference if they believed the school allocated compared unfavourably to their choice would turn appeals panels into a minefield.
"What will happen when a child applies to join a school halfway through the year?"