A new outer London rail line is to be created, mayor Ken Livingstone has announced.
Companies are bidding to run the new service
London Overground services will operate on the North London Railway when the mayor and Transport for London (TfL) take over control in November 2007.
They will also run on the East London Railway after the completion of the East London Line extension in 2010.
The mayor said this would "start the much needed revitalisation of London rail services".
"For decades, national rail services in London have been neglected and in many cases under-utilised," Mr Livingstone said.
The mayor said the transfer of responsibilities would raise the standards of service up to the levels of the Tube and the buses.
He also promised to deliver a rail link at Dalston Junction, in east London, connecting the two lines, allowing passengers to travel between Richmond in south-west London and West Croydon, south London.
The mayor said: "By joining together the North and East London Railways ahead of the London 2012 Olympics, we will create a new rail artery around the city, serving 20 London boroughs."
The service, which will run trains every eight minutes, will begin a radical upgrade of derelict stations, will be a "step change in British rail", Mr Livingstone claimed.
More help points, better lighting, information systems, a fleet of new trains and staffing at stations during opening hours would also be part of the upgrade
Govia, National Express, Netherland Rail and Laing are bidding for the contract to run London Overground services.