Infrastructure minister Åsa Torstensson has announced that the government plans to extend the number of speed limits from five to ten. The revised speed limits will move up in increments of ten, beginning at 30 km/h and topping out at 120.
Torstensson said that her department was currently working on the reform and that the bill would go before parliament sometime in the spring.
It is not yet known when the new signs will come into force.
Drivers in Sweden are currently required to adhere to speed limits of 30, 50, 70, 90 and 110 km/h.
The proposed 40 km/h limit is currently being tested in a number of built-up areas, while trial signs reading 120 km/h can be seen on the E6 motorway in southern Halland in the west of the country.
"People are moving around more today than they were a few years ago. Because of this I think that we should use all of the tools at our disposal to adapt to changing behaviours, changing speed limits being an example," said Torstensson.
The proposal to change speed limits for certain roads initially came from the Swedish Road Administration in 2005. But the previous infrastructure minister, Ulrica Messing, was unwilling to change the prevailing laws.
Claes Tingvall, road safety officer at the Swedish Road authority, welcomed the news.
"The current system is stiff and outdated and does not fit in with the way we view things today," he told news agency TT.
According to a simulation carried out by the Road Authority, more speed limits will also save a number of lives.
"The report this proposal is based on show that a moderate change would save 40-50 human lives per year," said Tingvall.
The Road Authority report suggests an adaptable model. For example, roads with a 90 km/h speed limit may be reduced to 80 km/h during the winter.
The maximum limit of 120 km/h will only apply to the safest stretches of motorway.
The principal is that speed limits will set in direct relation to conditions on a specific road.