Business Secretary Vince Cable said that driverless cars will hit the public roads in the UK starting from January 2015.
The UK government along with research organizations and businesses will be putting forward a proposal to make three UK cities test location for the next generation cars.
It has also launched a review to ensure appropriate regime for testing driverless cars in the UK.
The review will also cover two areas of the new technology, which includes a fully autonomous vehicle without a driver and a qualified driver to take control of driverless car.
UK Transport Minister Claire Perry said: "Driverless cars have huge potential to transform the UK's transport network - they could improve safety, reduce congestion and lower emissions, particularly CO2."
"We are determined to ensure driverless cars can fulfil this potential which is why we are actively reviewing regulatory obstacles to create the right framework for trialling these vehicles on British roads."