New laws will let the Government monitor the calls, emails, texts and website use of everybody in Britain.
Internet firms will be forced to give the Government’s intelligence agency GCHQ access to anyone’s communications.
The Home Office said it will strike a major blow against terrorism but civil liberty groups and others have heavily criticised the move.
The new law, likely to be announced in the Queen’s Speech in May would not allow GCHQ unprecedented access without a warrant. But intelligence officers would be allowed to examine material if someone came under suspicion.
In a statement, the Home Office said it was needed “to maintain the continued availability of communications data as technology changes”.
It added: “It is vital police and security services can obtain communications data in certain circumstances to investigate serious crime and terrorism.”
Any new announcement would have to be passed in Parliament and could face strong opposition from the Commons and the House of Lords.