TAOISEACH Enda Kenny says reform of local government was "long overdue" and part of the Government's "wider mission of reform."
Local government reform is expected to save €420m when complete.
Mr Kenny said the Government's plan will "completely redesign and relaunch" local government in Ireland.
"By the end of our term in office we will have delivered on our promise to overhaul our political system, economy and public services," he said.
Tanaiste Eamon Gilmore said reform is "never easy".
"There will be people who will find reform uncomfortable, because it will change the way they have worked, in some cases over many decades," he said.
Environment Minister Phil Hogan said the plan involved the "fundamental re-imagining of local government"'
"It sees local government leading economic, social and community development, as well as delivering efficient services that are good value," he said.
The changes on the table in Mr Hogan's overhaul include:
- merging of town and council councils roles;
- abolition of town councils;
- a cut in the number of councillors from 1600 to 950;
- redundancies for 500 workers to save €45m a year;
- curbing the ability of councillors to overturn planning decisions;
- more accountability and greater efficiency by councils.
The local electoral map of the country will also be substantially changed under the plan.
The number of councillors across the country will be reduced from 1,627 to 950 as a result of town and county councils being merged.
The cut will be achieved through the abolition of all 744 town councillors and marginally increasing the number of city and county councillors from 883 to a maximum of 950.
The electoral map of each county will be redrawn before the 2014 local elections.