Cabinet approved a bill that would allow pubs to open from 10.30am to 12:30am seven days a week, while nightclubs would not have to close until 6am.
The changes are expected to go into effect next year if the Oireachtas approve the legislation.
The government has also agreed to provide additional support to help businesses and communities adapt to changes in licensing legislation.
Tourism Minister Catherine Martin said the move will help create a better night economy.
Nine new pilot cities and communities will now recruit councillors to help develop a sustainable night economy in their regions.
These include Dublin City, Cork City, Limerick City, Galway City, Kilkenny, Drogheda, Sligo, Buncrana and Longford City.
There is also a new capital fund of up to €2 million for nightclub soundproofing.
Late bars will be allowed to remain open until 2:30am with a new late bar license required.
Bars and nightclubs open late must apply for permits from the courts and require CCTV on premises and fully accredited security personnel.
Justice Minister Helen McEntee is expected to tell her colleagues that Ireland will generally maintain a restrictive licensing system for the sale of alcoholic beverages.
Licenses can only be granted by courts, with objections approved by the Fire Service, Local Authorities, Health Board, Local Municipalities and Gardaí.
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