Schools could be ordered to give places to children in care, even if they were full, under government plans.
A Green Paper on children in care in England proposes putting an expectation on councils to place such children in the best local schools.
Other educational ideas include having a head teacher in each area to oversee their progress and £2,000 bursaries to ease their path to university.
The government wants a radical shake-up of a system which fails many children.
Currently, it says, only 11% get five good GCSEs compared with a national average of 56%.
They are more likely to be jobless, become pregnant as teenagers, misuse drugs or go to prison.
The charity NCH says a fifth of homeless people are care leavers.
At present there are some 61,000 children in care in England, 69% of whom are fostered.
In addition to seeking to give them places the best local schools, the government intends to give them free home-to-school transport so they can continue to attend even if they move home - which happens frequently.
And they would be guaranteed "catch up" support in school.
Ministers would take stock annually of the children's progress and the inspectorate, Ofsted, would check how each local authority was doing.
Education Secretary Alan Johnson said: "Children in care already face a tougher life than any child should have to.
"As a proxy parent, the state must raise its ambitions for these children, just as a good parent would, and transform their life chances through better emotional, practical and financial support at home and in the classroom.
"We can't immediately eradicate and solve all the problems children and young people in care face, but we can remove significant obstacles and ensure that our care system does what it says on the tin."
The general secretary of the Association of School and College Leaders, John Dunford, said it was unrealistic to expect schools and colleges to improve the long-term outcomes for children in care without the full support and co-operation of social services and local authorities.
So the government's emphasis on a co-ordinated approach was welcome.
"The vast majority of schools and colleges currently do their best to help and support children in care, but the cards are often stacked against the institution because of the frequency with which children move," he said.
"Social services must place a higher priority on stability of schooling when they are placing children in care."
He added: "Many children in care exhibit behaviour problems from an early age and additional support and resources must be allocated if schools are to successfully educate them."
Liberal Democrat education spokeswoman Sarah Teather proposed a "pupil premium" - additional funding to ensure young people got the attention and care they needed.
"Schools will then have an incentive to admit them as they will be guaranteed resources to properly care for them," she said.