While groups campaigning for female clerics to be treated equally expressed joy at the new plans, leading traditionalists reacted angrily to the development.
They claimed that the proposals were designed to "wipe out" those on the Anglo-Catholic and evangelical wings of the Church who do not believe it is in accordance with biblical teaching for women to be bishops.
The legislation, which would go before parliament if approved by the General Synod, could trigger a much larger defection of clergy to Rome than previously predicted. It follows a secret meeting held between the Vatican and three Anglican bishops last month.
The Rt Rev John Broadhurst, the Bishop of Fulham and one of those involved with the talks in Rome, said Anglo-Catholics would be "incandescent" and would effectively be "forced out" of the Church of England.
"I think they have no choice but to leave," he said.
"We will have to wait and see what the Church of England does with it, but my view is that Anglicanism as it used to be, which was a variety of groups coexisting peacefully, is over."
After years of wrangling over how to make women bishops, the group responsible for drawing up the final recommendations rejected all provisions that could have gone some way to placating traditionalists.
The report from the group, chaired by the Rt Rev Nigel McCulloch, the Bishop of Manchester, concluded that the Church should not create special safeguards to protect opponents of the reform.
They ruled against a scheme that would have established "flying" bishops to give pastoral care to traditionalist clergy, and also rejected suggestions that a "church within a church" should be set up for male clergy.
Instead, traditionalist parishes will be allowed to opt out of the oversight of a woman bishop and ask for a male bishop to perform blessings and ordinations.
The group acknowledged that the report is likely to prove divisive, but argued that the conclusions are "principled and pragmatic" and "endeavour to preserve that broad and comprehensive character of the Church of England".
They added: "The fact remains, however, that we have not been able to come up with a set of proposals that everyone now says that they can live with.
"Indeed, a number of members of the Committee have made it clear that they, like others, will seriously have to consider whether they can continue to hold office within the Church of England, or continue as members of it, if legislation of this kind comes into force."
A separate statement was issued by three Anglo-Catholic members of the Bishop of Manchester's group, including the Rt Rev Martyn Jarrett, the Bishop of Beverley, which expressed their "deep disappointment" at the outcome.
"Fundamentally, the draft legislation would render it virtually impossible for anyone to live the Christian life within the Church of England, who had conscientious objections about the ordination of women," they said.
There are likely to be heated exchanges when the proposals are debated at the synod, the Church's parliament, in July.
Fr David Houlding, a traditionalist member of the Synod, described the report as "wicked" and warned that many clergy could now be forced to leave the Church.
"It completely obliterates the position of anyone who in conscience can't accept women bishops," he said.
"I believe it's been designed to wipe out a sizeable proportion of the church who have been committed to the Church for centuries and who will now struggle to remain."
However, Christina Rees, a member of the General Synod and a leading campaigner in favour of women bishops, said she had cried with joy when she read the report.
"It feels as if the walls preventing women from full inclusion in the Church have finally come down," she said.
"It says that the Church is finally valuing women as equal."
SIC: TOUK