People with "hidden disabilities" such as autism and mental health conditions will be able to get blue badge parking permits under an overhaul of the system.
From next year, those with less immediately obvious illnesses will be eligible for the badges, allowing the holder to park closer to their destination like those with physical disabilities.
Those newly eligible in the scheme overhaul include:
Those who cannot make a journey without "a risk of serious harm to health or safety" or others, including children with autism
People who find journeys cause "very considerable physical distress"
Those with considerable difficulty walking, "both the physical act and the experience of walking".
The changes come after an eight week consultation held from January, which had more than 6,000 responses.
Although the current rules do not bar people with non-physical disabilities, the Department for Transport (DfT) says they are "open to interpretation" and require greater clarity.
Transport minister Jesse Norman said: "Blue badges are a lifeline for disabled people, giving them the freedom and confidence to get to work and visit friends independently.
"The changes we have announced today will ensure that this scheme is extended equally to people with hidden disabilities so that they can enjoy the freedoms that many of us take for granted."