This will include relaxing the restrictions on new or expanding selective schools - as well as allowing existing non-selective schools to become selective in some circumstances.
"For too long we have tolerated a system that contains an arbitrary rule preventing selective schools from being established - sacrificing children's potential because of dogma and ideology," she said.
"The truth is that we already have selection in our school system - and it's selection by house price, selection by wealth. That is simply unfair.
"That is why I am announcing an ambitious package of education reforms to ensure that every child has the chance to go to a good school.
"As well as allowing new selective schools we will bring forward a new requirement that means universities who want to charge higher fees will be required to establish a new school or sponsor an existing underperforming school.
"This is about being unapologetic for our belief in social mobility and making this country a true meritocracy - a country that works for everyone."
The government will consult on a number of new proposals including:
- requiring new or expanding grammars to take a proportion of pupils from lower income households,
- or establish a new, high-quality, non-selective free school,
- or set up or sponsor a primary feeder school in an area with a high density of lower income households
- or sponsor a currently underperforming non-selective academy.
Earlier this week Ofsted chief inspector Sir Michael Wilshaw aired his disapproval of suggestions that new grammar schools could be created.
"The notion that the poor stand to benefit from the return of grammar schools strikes me as quite palpable tosh and nonsense," he said.
"Their record of admitting children from non-middle-class backgrounds is pretty woeful."
Dr Mary Bousted, general secretary of the Association of Teachers and Lecturers, said: "The blight caused by academic selection at age 11 affects children's self-worth, ambition and confidence and can last a lifetime.
"If she chooses to pursue this course of action, Theresa May will break her promise to make ‘Britain a country that works for everyone, not just the privileged few'.
"Pupil selection has been tried and tested, the debate has already happened and the evidence could not be clearer, grammar schools entrench inequality, leaving the poorest and most vulnerable behind.
"In nearly all of the 164 grammar schools fewer than 10 per cent of pupils are eligible for free school meals, in 98 it is fewer than 3 per cent and in 21 fewer than 1 per cent.
"This entrenched disadvantage continues through life. The average hourly wage difference between the richest 10 per cent and the poorest 10 per cent of earners in grammar school areas is over £4 more than in non-selective areas."
