Casinos and gambling websites could be allowed to advertise on television and radio under a relaxation of rules.
The Gambling Act 2005 comes into force in September 2007
The new gambling code drafted by the Advertising Standards Authority (ASA) and the Gambling Commission will go out to public consultation this summer.
The code will clarify a provision of the Gambling Act 2005 - to be introduced next year - allowing for advertising rules to be relaxed.
The government says the new rules will be subject to "very tight controls".
Betting services, bingo halls, gaming machines and football pools will be covered by the new rules, as well as overseas companies operating online gambling sites.
The current rules on advertising gambling are about 40 years old and are seen by some industry observers as restrictive.
In print adverts, casinos are limited to printing largely factual information about their premises.
Television adverts for all betting, gaming and lotteries - except for the National Lottery - are banned.
The new code is expected to take effect by September 2007 when the Gambling Act 2005, which allows for more casinos to open, comes into effect.
Gambling Commission deputy chief executive Tom Kavanagh said the code was needed to co-ordinate advertising rules for all sectors of the gambling industry.
The code would mean "both online gambling and casinos will have more freedom in what they can say", he added.
"The thinking behind it is really that the current restrictions are around 40 years old.
"They don't make a lot of sense in the current regulatory environment - the idea that you just can't tell people anything about the current availability of casinos."
The commission would make it a condition of operators' licences to comply with the new advertising code, he added.
A spokesman for the Department for Culture, Media and Sport said casinos were currently "extremely heavily restricted in terms of advertising".
"They will, in a limited way, be allowed to advertise more," he added.
"But adverts will be subject to stringent rules about realism and social responsibility, and controls on when, where and what gambling adverts are allowed to do."
Online betting sites based overseas would be banned from advertising in the UK "unless they meet the same high regulatory high standards we have here", he said.
"This is a vital control to tackle the new challenge we face from online gambling."
A spokesman for the Salvation Army said it was "concerned" about the introduction of adverts "for hard forms of gambling into mainstream television viewing".
"As more people are exposed to the adverts they become more likely to go to casinos to gamble, and we fear this could lead to an increase in problem gambling."