The French cabinet has adopted a bill to create a legal right to housing, after a series of high-profile protests by campaigners.
Homeless people camped out across France to demand rights
The demonstrations prompted President Jacques Chirac to promise action in his New Year's address.
If approved by parliament, the bill will legally oblige local authorities to provide accommodation for the homeless from the end of next year.
People facing eviction or living in squalid conditions will also be helped.
The bill would also create a new repatriation and resettlement package to allow immigrants with no family ties in France to return home.
President Chirac has said that it should be possible to build 120,000 homes a year for the underprivileged.
The government, embarrassed by the campaign that saw thousands of people camping out on the streets, has already pledged to find 30,000 hostel places immediately for those living rough.
Pressure groups say there are up to 100,000 homeless people in France.
In addition, 900,000 people are thought to live in campsites, hotels and shelters, and a further two million have sub-standard housing.
The two main contenders in the presidential elections, Interior Minister Nicolas Sarkozy and the Socialist Segolene Royal, have promised state action to help the homeless.