Government ministries are to prepare reports within 30 days and the order will be implemented by June 2018, the Saudi Press Agency reported.
Saudi Arabia is the only country in the world to forbid women from driving.
Under the current system, only men are allowed driving licences and women who drive in public risk being arrested and fined.
Because of the law, many families have had to employ private drivers to help transport female relatives.
Rights groups in the kingdom have campaigned for years to allow women to drive, and some women have been imprisoned for defying the rule.
"The royal decree will implement the provisions of traffic regulations, including the issuance of driving licences for men and women alike," the Saudi Press Agency (SPA) said.
The country's US ambassador, Prince Khaled bin Salman, said it was "an historic and big day" and "the right decision at the right time".