The Conservative Lord Kenneth Baker of Dorking has announced he will be tabling an amendment to the Government's Education Bill when it comes before the House of Lords.
The amendment proposed by the former education secretary will make it mandatory for faith schools to open their doors to pupils of other faiths and none.
If his amendment is approved, churches and other faith groups would have to give priority to pupils from outside their faith for a quarter of the places in any new schools they open, reports the Press Association.
The move follows the announcement by the Church of England that it intended to introduce such a plan voluntarily.
"It is an inclusive agenda. The Church of England supports it, the Government thinks it is right but just won't legislate on it which I think is a mistake," Lord Baker told the BBC1 Politics Show.
"I think our society will be much happier and more integrated and more understanding and more tolerant if you have those sorts of schools rather than exclusive faith schools."
The leader of the Conservatives, David Cameron, welcomed the announcement by the Church of England that it would open its doors to other faiths and none when he addressed the Conservative Party Conference in Bournemouth. He encouraged other faiths to consider taking the same action.
Shadow education secretary, David Willetts, said, however, that the Party would not back the measure but did suggest that Conservative peers could be given a free vote.
"We will not be backing Ken Baker's amendment. It could be something therefore on which we abstain but, given the personal issues of conscience in it, it could well be something for a free vote."
Willetts suggested that a move by Muslim schools in particular to take in non-Muslim pupils might be beneficial for improving community relations.
Meanwhile, one of Northern Ireland's leading Catholic bishops, Dr Patrick Walsh, Bishop of Down and Connor, has warned that radical plans to reform Northern Ireland's education system could undermine the Catholic Church's ability to protect and promote the ethos of its schools.
Speaking at the opening and blessing of a major new extension at Dominican College in Belfast last Friday, Bishop Walsh said: "Distinctiveness is something to be treasured, to be encouraged, not to be denigrated, not to be eliminated."
The current Bain Review is likely to scrap academic selection as well as recommend that schools in different sectors share resources, and possibly even facilities, as a measure to counter the dramatic drop in pupil numbers across the province.
