More than three million people go to the dogs every year
All greyhounds will be required to have microchip implants to help trace them in their retirement under government proposals to raise welfare standards.
The chips would identify the dogs during and after their racing careers amid concerns that many animals are being abandoned later in life.
Charities have called for greater protection for retired greyhounds.
Industry groups said £4m was being spent every year on welfare including finding homes for retired animals.
Greyhound owners would be responsible for ensuring their animals are chipped to improve their "traceability" under plans which have now gone out to consultation.
The proposals would mean dogs would not be allowed to race unless they have a chip containing details of their age, name and owners, which must be listed on an approved database.
"Greyhound racing is a sport that many people enjoy but the welfare of the dogs is paramount, both during and after their racing careers," said animal welfare minister Jane Kennedy.
Ministers want to enforce specific welfare standards in the popular sport, watched by three million people a year, for the first time.
Greyhounds are protected, under general animal welfare laws, against cruelty and neglect but MPs have been pressing for some time for specific regulations for the sport.
In future, tracks will be required to check a greyhound's ID to make sure it is registered on an appropriate database and that its owner is as indicated before it can race
The regulations, which if agreed will come into force next year, will allow action to be taken against any offenders.
The Greyhound Board of Britain, the sport's governing body, said it was doing all it could to make sure greyhounds were properly cared for after their racing days are over.
It said it had given £1.7m to the Retired Greyhound Trust which had found homes for 4,500 retired greyhounds in 2007.
It said it welcomed the government's welfare proposals but was seeking more information on how the chip system would work.
At the moment, greyhound owners are required to notify the Board when their dogs retire while all English bred greyhounds have tattoos in their ears indicating their age and pedigree.
While many owners choose to keep the animals as pets, the fate of some dogs continues to cause concern.
There was an outcry in 2007 when a man admitted to burying greyhounds he had killed at his Country Durham home, without a permit, and was fined £2,000.
Ms Kennedy said the new regulations would give "clear conditions for all owners, trainers and track operators" as to their welfare responsibilities.
It would also create a "legal benchmark" so that individuals found to be maltreating animals can be punished.
The amount spent on animal welfare by the industry has risen significantly in recent years, with £4m allocated to improving the condition of tracks and other measures this year.
But the RSPCA said more should be done.
"It is equally important that greyhounds are protected throughout their life - not just when racing but while they are being trained, transported and when they are retired," a spokeswoman said.