Malicious internet trolls could be easier to track down but websites won’t have to remove potentially libellous comments automatically.
Websites and internet providers would have to reveal the names, email addresses and internet addresses of people who post threatening messages online.
But the government’s Defamation Bill would mean websites are no longer responsible for user comments, and won’t have to remove them because someone claims they’re abusive or untrue.
There will also be a one-year limit for online libel claims so that people can’t complain about articles published years before.
The bill, which got its first reading in Parliament this week, follows cases including Nicola Brookes, who forced Facebook to reveal the identities of people who posted 'vicious and depraved' abuse on her page.
On Monday, Frank Zimmerman was banned from contacting a list of public figures he abused and threatened online, including MP Louise Mensch, Lord Sugar, and General Sir Michael Jackson, former head of the British army.
Justice Secretary Kenneth Clarke said: "As the law stands, individuals can be the subject of scurrilous rumour and allegation on the web with little meaningful remedy against the person responsible.
"Website operators are in principle liable as publishers for everything that appears on their sites, even though the content is often determined by users.
"But most operators are not in a position to know whether the material posted is defamatory or not and very often – faced with a complaint – they will immediately remove material.
"Our proposed approach will mean that website operators have a defence against libel as long as they comply with a procedure to help identify the authors of allegedly defamatory material."
Internet freedom activists have warned the bill could remove anonymity for whistleblowers or victims of crime online.
The bill promises a formal notice of complaint, but the Ministry of Justice has not yet revealed how the complaints procedure will work, or who will oversee it.
"The government wants a libel regime for the internet that makes it possible for people to protect their reputations effectively but also ensures that information online can't be easily censored by casual threats of litigation against website operators,” Mr Clarke added.
"It will be very important to ensure that these measures do not inadvertently expose genuine whistleblowers, and we are committed to getting the detail right to minimise this risk."
The Internet Service Providers’ Association warned that ISPs will only identify customers if there is ‘prior authorisation or through the agreed legal process’, as with the recent court order to block The Pirate Bay.
Overall ISPA, which represents more than 200 online operators in the UK, including Google, Virgin and BT, welcomed the proposals to stop ISPs being responsible for content.
ISPA secretary general, Nick Lansman, said: "ISPA welcomes the publication of the Defamation Bill and the underlying recognition that ISPs are not best placed to decide if content is defamatory or not.
“The details of how the system will operate will be set-out in secondary legislation and ISPA will ensure that ISPs will only be required to identify customers with prior authorisation or through the agreed legal process."
Justine Roberts, co-founder of the online community Mumsnet, warned that blanket laws could squash free speech as easily as preventing slander:
“In efforts to out the internet trolls the law must be careful to protect anonymous posts that let people access often life-saving support and advice,” she told The Guardian.