Affected users would be blocked from using apps between midnight and 6am unless they change the default setting.
Features designed to keep users scrolling for longer, including videos that automatically play one after another, would also be switched off by default.
The new measures aim to prevent a cliff edge for those who will gain access to social media when they turn 16, and offer some protection from the negative effects of late-night scrolling.
"These measures will be crucial in helping young people get the sleep they need, focus on school and college, and spend more quality time with family and friends," Technology Minister Liz Kendall said in a statement.
The move underlines global concerns among parents and policymakers about safeguarding young children from the harmful effects of social media on their mental and physical health.
Results of a study published on Tuesday showed restrictions led to improvements in sleep, concentration and wellbeing, and that an overnight curfew was the easiest measure for families to maintain and produced the most consistent sleep benefits.
The first set of regulations on social media restrictions will be laid before parliament by the end of this year, with measures expected to come into force in spring 2027, the government said.
It promised "robust implementation and enforcement".
However, a team that advised Australia - the first country to ban social media for children - found that online platforms were stumbling at the very first step of implementing age-verification checks, rendering the ban ineffective.
Google and TikTok have in the last month separately settled a US lawsuit brought by a minor who claimed that social media platforms damaged his mental health.
