The House of Commons education select committee has made the recommendation in its first report from its inquiry into foster care, after hearing evidence that carers feel neglected and unsupported in the social care system.
Carers also told MPs that they are bypassed in decisions made about children they look after and that they struggle to access good quality training.
The committee's report said the government should set up a national college for foster carers to champion improvements in working conditions as well as provide access to training and support.
The committee also proposes a national register of carers, which would be coordinated by the proposed college and would contain details of carers' experience, training and qualifications. This would make it easier for carers to transfer between agencies, the committee's report said.
The college should also handle complaints and allegations about carers and be responsible for de-registering them if necessary, the report adds.
However, the committee stopped short of calling for foster care to become a recognised profession.
"Foster carers do not always receive the respect and recognition they deserve," the report states.
"They perform a remarkable and invaluable service for thousands of young people. The government must do more to support and value foster carers.
"We call upon the government to consult on the establishment of a national college for foster carers, which would work to give carers the support they need, and the recognition they deserve."
Among foster carers giving evidence to the inquiry was Pamela Menzies, who told MPs that carers feel "undermined, bypassed and treated as glorified babysitters".
Foster parents Karen and Michael Fesemeyer told MPs that "foster carers are at the bottom of the pecking order and their views, opinions, knowledge and experience are usually considered to be of very low value".
Another carer, Brian Roberts, said carers are "battered " and "abused" by the care system and feel "so incredibly unsupported, neglected and overwhelmed".
Committee chair Robert Halfon said: "Foster carers have a really important role in society and are often providing fantastic care in sometimes difficult circumstances.
"But our inquiry showed it is clear that too many are not adequately supported, neither financially nor professionally, in the vital work that they do."
The committee's report also calls for children in foster care to be given better information about their placements and have access to advocacy services.
Among other recommendtions are that siblings in care should be placed together where possible and a national recruitment and awareness campaign should be launched to increase the number and variety of carers.
Earlier this week children's minister Robert Goodwill announced that the government had backtracked on a decision to exclude foster carers form the extended 30 hours free childcare offer. It is hoped they will be able to access this offer from September next year.
Ray Jones, emeritus professor of social work at Kingston University and St George's, University of London, said: "There is much wisdom and sense in the MPs report, especially about the financial crisis hitting children's services because of government cuts and how this is impinging on foster care.
"There is also the recognition that the government's is making it all more complicated, costly, and delaying improvement by coercing and forcing local authorities to place children's social services outside of their direct provision with the select committee stating that the government should instead focus on providing more help and guidance to councils.
The select committee has not, however, really faced up to the concerns about private foster care agencies making big profits and has now become a flow rather than leak of children's services funding to the increasingly wealthy owners and directors of these agencies.
"Nor has it addressed the concern that social workers are placing children with private agency carers who are unknown to the social workers and to councils and may mean children being placed at a great distance from their families, schools, communities and from their social worker."
Children's minister Robert Goodwill said: "We welcome the education Select Committee's report, which highlights the invaluable role that foster carers play in the lives of vulnerable children. A happy and stable home for children in foster care is vital, and we are committed to supporting these looked after children and their foster carers.
"This includes investing £200m in our Innovation Programme to test new and effective ways to support vulnerable children. Just this week we also announced that we will extend our 30 hour childcare offer to foster children to provide extra help for foster carers.
"We will consider the report's findings and recommendations alongside the independent review, the National Fostering Stocktake, which will help us to identify improvements to the support and outcomes for looked after children."