Only eco-towns with the highest ecological standards will be chosen for construction, Housing Minister Caroline Flint has announced.
Bids for sustainable developments were invited from across England as part of a government commitment that all new homes will be zero carbon by 2016.
But Ms Flint said most of the 60 proposals received will be rejected.
Plans for the eco-towns have provoked public opposition, with action groups calling for them to be scrapped.
Ms Flint also said she would look at setting carbon targets for non-domestic buildings such as shops and pubs.
The towns are expected to have low and zero-carbon technologies, good public transport and extensive parkland.
In her first speech on the plans, Ms Flint said the criteria would be strictly applied.
"Weak bids where the greenest element is the recycling of failed proposals won't make it through," she told an audience at an ecological housing conference in Earl's Court, London.
"I would like to see eco-towns which follow the most ambitious European models where half the households do not rely on a car.
"To help achieve this, major facilities such as schools and health centres should be located within 10 minutes' walk."
The towns will be expected to meet other criteria such as:
The successful applications will receive an undisclosed level of central government funding, as well as help with meeting the requirements of local planning regulations.
A Department of Communities and Local Government spokesman said it is expected that there would be up to five eco-towns by 2016 and 10 by 2020.
The department estimated the size of each town would range from 5,000 to 20,000, and possibly up to 50,000 residents.
The spokesman said the majority of bids have been proposed for brownfield sites such as disused public sector land.
But there has been significant opposition to eco-towns from local residents who say the developments will swamp rural villages and damage wildlife for little environmental gain.
Some residents have set up action groups and held protests against proposed developments.
Plans to create an eco-friendly town in Cheshire were dropped after angry local opposition.
Ms Flint said a long-list would be drawn up in the coming weeks, followed by a full public consultation. A final shortlist is to be published later in the year.
Ms Flint said she welcomed a dialogue on the issue, but that she was none-the-less committed to meeting the housing shortage by building more homes.