The new law, set to receive parliamentary approval by July, is seen as a protective move especially for girls by annulling foreign marriages involving minors.
It will allow youth welfare workers to take into care underaged girls even if they were legally married abroad and, if deemed necessary, separate them from their husbands.
"Children do not belong in the marriage registry office or the wedding hall," said Justice Minister Heiko Maas in a statement sent to AFP.
"We must not tolerate any marriages that harm minors in their development."
"The underaged must be protected as much as possible," he said, adding that as a result of the change no minor must suffer restrictions on their asylum or residential status.
The age of consent for all marriages in Germany will be raised from 16 to 18 years. Currently in some cases an 18-year-old is allowed to marry a 16-year-old.
Foreign marriages involving spouses under 16 are considered invalid, and those involving 16 or 17-year-olds can be annulled by family courts.
Rare exceptions are possible if the couple were married as children but are now both adults and want to stay married.
The draft law would also punish with a fine any attempts to marry minors in traditional or religious rather than state ceremonies.
There were 1,475 married minors registered in Germany last July - 361 of them aged under 14 - according to the latest figures released after a parliamentary request.
Of these 1,152 were girls, said the interior ministry. The largest group, 664 children, came from Syria followed by 157 from Afghanistan, 100 from Iraq, and 65 from Bulgaria.
The conservative daily Frankfurter Allgemeine Zeitung welcomed the bill, saying that "archaic practises that harm women and children have no place" in Germany.
The aim was not to "paternalistically spread one's values or disrespect foreign cultures", but "enforcing fundamental and, in principle, globally recognized human rights".