Railway lines closed in the 1960s could be reopened if they boost the economy, the government has said.
The plan forms part of a wider rail strategy under which the government will consider splitting up two of the biggest train operators.
The move would affect Great Western and GTR, which comprises Southern, Thameslink and Great Northern.
The government also plans to devolve running the track and train services to local companies.
At the moment Network Rail, which is state-owned, looks after the track and other infrastructure while train services are operated by private companies.
The first public-private partnerships introduced would be on the East Coast mainline from 2020.
Mr Grayling said: “When something goes wrong we’ve got a joint team that tackles the problem”.
Some 4,000 miles of rail routes were closed in the 1960s, mainly in rural areas, known as the Beeching cuts.
Transport Secretary Chris Grayling said the new rail lines could unlock jobs, encourage house building and ease overcrowding.
“The system is creaking – it’s bursting at the seams,” he told BBC Radio 4’s Today programme.
Mr Grayling said the new routes would “provide better services for commuters but also unlock housing potential”.
“Work on Oxford to Cambridge route starts next summer, and we’re looking to re-open routes around Bristol, Birmingham Exeter and the North East,” he said.
He added that the government was going to consult on splitting up the Great Western franchise between London, the South West and Wales.
That could result in one company running long-distance lines between London, Wiltshire, Somerset, Devon and Cornwall – while another runs local services across the South West.
But Labour has called the ideas “un-funded proposals”, with shadow transport secretary Andy McDonald describing the plans as “unambitious”.
“The Tories’ record is of delayed, downgraded and cancelled investment, huge disparities in regional transport spending and soaring fares that are pricing passengers off the railway.”
Mick Whelan, general secretary of the train drivers’ union Aslef, said the union would be “pleased to see the lines cut by Beeching restored”.
However, he said Mr Grayling’s new plans would not boost jobs and housing, asking: “Where is the bold strategic vision for rail – and integrated transport links – in this country?”
Councils and business have also been asked to submit proposals for new lines.
However, the government has no plans to make new money available to fund any such suggestions, the BBC’s transport correspondent Richard Westcott said.
The new strategy will also outline improvements to the way private companies running the trains, work with the publicly owned Network Rail which runs the tracks.
Who was Dr Beeching?
Richard Beeching’s brief as chairman of the British Transport Commission was simple: “Make the railways pay.”
British Rail was losing £140m a year when Dr Beeching took over the commission. His solution, announced on 27 March 1963, was equally straightforward – massive cuts.
The Conservative government welcomed the report, but thousands of people – many in remote rural areas – were horrified they would lose their local branch lines.
Opposition from the pressure groups failed and during the 1960s “Beeching’s Axe” fell on 2,128 stations and more than 67,000 British Rail jobs.