A consultation has been launched which will lead to the formation of the Uk's first National Dementia Strategy.
Part of the plan will be an immediate review into the use of antipsychotic drugs to treat sufferers of dementia, Health Minister Ivan Lewis said.
Mr Lewis said the review of prescriptions for antipsychotic drugs will be completed before the strategy is published in the autumn.
Neil Hunt, chief executive of the Alzheimer's Society, said it was a "landmark day" and described the review as "urgently needed".
Mr Lewis said the government will also consider the creation of more memory clinics where patients can learn techniques for improving their memory and get information about their condition.
Professor Murna Downs, head of the Bradford Dementia Group at the University of Bradford, said: "We welcome the national strategy for dementia - the first of its kind in this country - and its clear indication that the status quo in dementia care is no longer acceptable.
"We are particularly pleased to see an emphasis being placed on the need for training and education for the workforce to ensure they are equipped with the right information, attitudes and skills to promote quality of life and dignity for people with dementia.